The US Attorney's Office has formally charged a 33-year-old Iranian money changer named Seyed Sajjad Shahidian after he was arrested in Britain at the request of the United States on charges of money laundering, bank fraud and identity forgery. He appeared in court on May 18, 2020 in Minneapolis, Minnesota, and pleaded not guilty to the charges against him.
Shahidian, who is also known as Soheil Shahidi, is the director of Payment24 Company, an online currency exchange in Iran. The US Attorney General has accused Vahid Vali, one of the company's directors, of similar offences, as well as accusing him of circumventing sanctions against Iran. However, although Vali is facing prosecution in the United States, he has not been arrested.
The media in Iran have characterized Shahidian as a successful entrepreneur and a capable financial manager who earned $2.5 million in five years.
What is Payment24?
In 2016, a few months after the lifting of international sanctions against the Islamic Republic of Iran prompted by the signing of the nuclear deal, Seyed Sajjad Shahidian established the Seyed Sajjad Shahidian and Partners Currency Exchange Company.
The nature of the company's activities was defined as the purchase of cash and the sale of foreign currency and gold coins produced by the Central Bank of the Islamic Republic of Iran; conducting foreign exchange remittances through domestic banks and non-bank credit institutions, and providing foreign exchange services outside the country within the framework of Iran's currency regulations.
The Payment24 Company, which has been active in international online payments, was established in 2009, seven years before the establishment of the Seyed Sajjad Shahidian and Partners Currency Exchange Company. At that time, international sanctions against the Islamic Republic of Iran had not yet intensified. However, after financial and banking sanctions against Iran got underway, Payment24 remained active and described its activities as "solving the problems of our compatriots’ foreign currency payments" and "removing obstacles to using international methods for sending and receiving."
While international payments from financial companies, especially US institutions, were initially restricted and then banned by the United States, Payment24 offered a variety of services, including student payments to register for international exams, foreign currency payments via PayPal accounts, online purchase from foreign stores, payment for embassy appointments outside the country, and cashing in on foreign exchange revenues.
During the presidency of Mahmoud Ahmadinejad (2005-2013), the Supreme Leader Ayatollah Ali Khamenei repeatedly called on the government to find ways to circumvent the US sanctions. In 2018, after Donald Trump’s administration reimposed sanctions against Iran, President Hassan Rouhani said that the Islamic Republic would proudly circumvent the sanctions. This was a few months before the arrest of Shahidian.
According to the US Attorney's Office, Payment24 has been one instrument used to circumvent the sanctions. The company's services ceased in the winter of 2018, a few months after Shahidian was arrested in the UK, and at this point the Payment24 website became inaccessible.
Seyed Sajjad Shahidian and Partners Currency Exchange Company was dissolved by the Central Bank of the Islamic Republic of Iran in September 2019, one year after Shahidian's arrest in Britain. After his arrest, one of the company's associates was appointed as director of liquidation for the company's dissolved accounts.
Did the Iranian Government Support Shahidian?
Seyed Sajjad Shahidian was arrested in the United Kingdom in mid-2018 at the request of the United States, but when the embassy of the Islamic Republic of Iran sought consular support, Shahidian refused its offer of help, thereby rejecting the process that could bring him diplomatic immunity and announcing his readiness to be extradited to the United States to stand trial.
On March 11, 2020, Hamid Baeidinejad, Iran's ambassador to London, posted on Twitter that embassy officials had met with Shahidian to inform him of the dangers of being extradited to the United States. But Shahidian preferred to be extradited to the United States from Britain instead of having the Islamic Republic of Iran’s consular support.
What Does the Indictment Say?
The Assistant Attorney General for National Security and the Attorney General of the United States filed a total of six charges against Seyed Sajjad Shahidian, Vahid Vali, and Payment24.
According to the allegations in the indictment, Payment24 was an internet-based financial services company with approximately 40 employees and with offices in Tehran, Shiraz, and Isfahan, Iran.
"The primary business of Payment24 was helping Iranian citizens conduct prohibited financial transactions with businesses based in the United States, including the unlawful purchase and exportation of computer software, software licenses, and computer servers from United States companies."
"According to the Payment24 website, the company charged a fee to circumvent 'American sanctions,' and claimed to have brought in millions of dollars of foreign currency into Iran."
The US Attorney's Office says Payment24 provided Paypal financial services and Visa gift cards in Iran through the United Arab Emirates, and that Shahidian, along with Vali based in the United States, provided false information, including false postal addresses, fraudulent passports and forged identity documents using stolen identities, and had set up accounts for their dollar exchange transactions.
What Laws are Shahidian and Vali Accused of Violating?
The US Attorney's Office says the defendants have violated the International Emergency Economic Powers Act (IEEPA). The Act prohibits the direct or indirect export of goods, technology, or services from the United States to Iran.
The case against Shahidian, Vali, and Payment24 is the result of an investigation by the federal police in Minneapolis and the Office of International Criminal Investigation, with the cooperation of British police and justice officials who extradited Shahidian. However, according to the indictment, the investigation into other possible actions carried out by the defendants is still underway.