REVENUE & CUSTOMS
PROSECUTION OFFICE News Release (09003) issued by COI News
Distribution Service on 4 June 2009
Three businessmen
were jailed today for a total of 10 years at Southwark Crown
Court, following a successful prosecution by the Revenue and
Customs Prosecutions Office (RCPO), for conspiring to export
military equipment to Iran and for conspiring to supply military
goods from the USA to Iran via Hong Kong and Romania.
The three businessmen, two of whom had been granted political
asylum in this country having fled from Iran in 1995, were charged
with obtaining parts to be used as spares for Iran's ageing
military aircraft, including F14 Tomcats, F4 Phantoms, F5 Tigers
and Cobra Attack Helicopters.
In May 2006, HM Revenue and Customs officers intercepted a
shipment of eight liquid oxygen converters bound for Iran at
Heathrow Airport. The liquid oxygen converters had been designed
in the USA and manufactured as part of the breathing system for
aircrew in fighter jets.
The defendants claimed that the liquid oxygen converters were for
use in ambulances, and supplied HM Revenue and Customs with
documentation to establish this. Following detailed investigation,
it was discovered that the documentation was fake and had been
created by the defendants, and that the trade in aircraft parts
had begun at the end of 2005. The three defendants were arrested
between August and November 2007 and their homes and businesses
were searched.
Following a further two years' worth of work by prosecutors
and investigators, including RCPO issuing formal requests for
evidence to Hong Kong, Romania and Luxembourg, 8,000 pages of
evidence was gathered and presented to the court.
The evidence showed that the defendants received requests from
Iran for them to obtain and supply parts, including oxygen
converters, military radios, helicopter engine transmissions and
electric motors for 20mm Gatling-type cannons. They then sourced
the parts from the USA and were advised by their suppliers that
exporting them required an export licence. The defendants
pretended that the parts were for customers within the USA and
arranged for them to be shipped to an address in Florida. From
Florida, the parts were exported to the UK and then on to Iran
using misleading descriptions of the parts and their value.
David Green QC, Director of RCPO, said:
"This is an excellent example of international law
enforcement and prosecuting agencies working together to prevent
arms trafficking, and more specifically to end the activities of a
major Iranian arms procurement network. RCPO prosecutors worked
with counterparts in the USA, Hong Kong, Luxembourg and Romania to
acquire the evidence that has allowed us to bring this case to a
successful conclusion."
Background information
Mohsen Akhavan Nik came to the
attention of HM Revenue & Customs officers in 2000 when a
laser that he had sent to Iran was seized and he was warned about
arms trafficking. He claimed that the laser was used to project
advertising slogans onto the outside of buildings when, in fact,
it was designed for battle simulation by tanks.
In May 2006, HM Revenue and Customs intercepted a shipment of
eight liquid oxygen converters bound for Iran at Heathrow Airport.
The liquid oxygen converters were part of the breathing system for
aircrew in fighter jets.
Mohsen Akhavan Nik and Mohammed Akhavan Nik claimed that the
liquid oxygen converters were for use in ambulances and supplied
HM Revenue & Customs with documentation purporting to
establish this. Following detailed investigation, it became clear
that the documentation was fake and that their trade in aircraft
parts to Iran had begun at the end of 2005.
In August 2007, HM Revenue and Customs officers arrested Mohsen
Akhavan Nik and Mohammed Akhavan Nik and searched their home in
Ascot where their business was also based. A large quantity of
documents, computer material and some aircraft components were
seized. Examination of that material led the investigators to
speak to Nitish Jaitha who provided further documents. A detailed
analysis of that material led the investigators to arrest Jaitha
in November 2007.
The material gathered showed that Mohsen Akhavan Nik received
requests from one of two people in Iran to obtain parts and supply
quotes for the delivery of those parts to Iran. These requests
included not just liquid oxygen converters but a vast array of
parts required for military aircraft.
Mohsen Akhavan Nik and Mohammed Akhavan Nik then asked Jaitha to
source the parts from the USA. On regular occasions, the supplier
of the parts would specifically state that the parts required an
export licence from the USA authorities before those parts could
be exported. When that happened, the defendants pretended that the
customer for the parts was in the USA and would arrange shipment
of the goods to an address in Florida that had been set up by
Mohsen Akhavan Nik and Mohammed Akhavan Nik. Once the goods were
received in Florida, they were exported to the UK and then on to
Iran using false descriptions of the parts and their value.
Following the seizure of the liquid oxygen converters in May
2006, the three men changed their method of operation so that the
parts were shipped from the USA to Hong Kong, from where they were
sent to Iran. Following that, the three men shipped five liquid
oxygen converters to Romania. However, before they could be sent
on to Iran, they were intercepted in February 2007 by Romanian
customs officers at Otopeni Airport in Bucharest. That in turn led
to the interception of a further 32 liquid oxygen converters in
March 2007 in Florida by special agents of the United States
Immigration and Customs Enforcement. However, these further
interceptions did not stop the illegal activities of the
defendants. By using a variety of false identities and bogus
companies, the three men continued to order parts and ship them to Iran.
By the time of the arrests, Mohsen Akhavan Nik and Mohammed
Akhavan Nik had received over £500,000 for aircraft parts that had
been sent to Iran, and Nitish Jaitha had received over £200,000.
It became clear from the documents that had been seized and
analysed that the expectation of the defendants was that those
amounts were going to be hugely increased had it not been for
their arrests.
The trial began on 27 April 2009 with the defendants denying all
of the allegations. During the trial, both Mohsen Akhavan Nik and
Mohammed Akhavan Nik claimed that, while they had no qualms about
breaking USA export control laws, they had not and would not break
UK export control laws. However, they accepted that they had acted
with considerable dishonesty in their manufacture and use of false
identities and false companies in effecting these shipments to
Iran. They asserted that that dishonesty was the means by which
the USA export control laws were broken rather than the UK export
control laws.
NOTES FOR EDITORS
1. Defendants
* Moshen Akhavan Nik DOB: 11/11/1959
5 years on count one, 3
years on count two, to run concurrently and also disqualified as
Company Director for 7 years
* Mohammed Akhavan Nik DOB: 02/06/1982 -
2 1/2 years on
count one, 18 months on count two, to run concurrently
* Nitish Jaitha DOB: 02/09/1965 - 2 1/2 years on count one, 18
months on count two, to run concurrently
2. Offences for which all three defendants were convicted
* Conspiracy to evade the prohibition on the export of goods
contrary to Section 1(1) of the Criminal Law Act 1977
*
Conspiracy to evade the prohibition on the movement of controlled
goods between third countries contrary to Section 1(1) of the
Criminal Law Act 1977
3. The UK has had a national arms embargo in place in relation to
Iran since March 1993.
4. The Military List is contained within Schedule 1 to the Export
of Goods, Transfer of Technology and Provision of Technical
Assistance (Control) Order which includes machine guns, pistols,
cannon, flame throwers, ammunition, bombs, missiles, military
vehicles and aircraft, chemicals, armour, fuels and other
technical equipment.
5. The Revenue and Customs Prosecutions Office (RCPO) was created
by the Commissioners for Revenue and Customs Act 2005 on 18 April
2005. An independent prosecuting authority, RCPO reports directly
to the Attorney General and is responsible for prosecuting cases
for HM Revenue & Customs (HMRC) and the Serious Organised
Crime Agency (SOCA). RCPO prosecutes some of the largest drug and
fraud cases in the UK.
6. For more information, contact the RCPO press office on 020
7147 7747.