U.S. Moves to Seize New York Skyscraper & Islamic Centers In Crackdown on Iran, Bank Melli

Agents accuse Iran of spreading weapons of mass destruction.

ByABC News
November 12, 2009, 4:44 PM

Nov. 12, 2009 — -- Iranian officials, in violation of numerous U.S. laws, have used an American foundation as a front company to control a Fifth Avenue skyscraper, avoiding taxes and feeding cash to a bank owned by Iran, according to federal prosecutors in New York.

In addition to the prime piece of Manhattan real estate, the U.S. Attorney in Manhattan sought to seize real estate that had tenants or current owners including three Islamic educational centers and mosques and one religious school, alleging in part that the properties were purchased with laundered money.

The civil complaint details the alleged internal machinations of the Iranian government's ambassadors and other officials over control of the property and its cash flow – Iran's primary economic engine in the United States. Read the complete complaint here.

The main building, at 650 Fifth Avenue, was built during the reign of the Shah of Iran, a U.S. ally, and paid for through a foundation set up to manage the Shah's charitable interests in the U.S. After the Iranian revolution, the Islamic Republic of Iran essentially staged a palace coup – ousting the majority of the foundation's board members and replacing them with members who served at the pleasure of the new regime.

The civil action cites a Reagan era executive order and subsequent Clinton and Bush executive orders as granting the Justice Department the authority to bring the action. The executive orders state that Iran actively supports terrorism as state policy.

It also alleges that the Iranian government used the proceeds of money laundering to acquire assets in the United States, and those assets, which include substantial real estate properties. The action also seeks the forfeiture of those properties.

The complaint is based on an investigation by federal, state and New York City counter terrorism investigators, and cites information seized in a search of the property.

In 2007 ABC News.com reported on the investigation in the past, and noted that the law firm of former Attorney General Michael Mukasey represented the Iranian controlled interests. Read that report here.

Officials say that for more than 25 years, intelligence and law enforcement agencies have suspected the New York-based Alavi Foundation is a "front" for Iranian espionage and anti-American activities.

During that time, court records show the foundation has been publicly defended and represented by the New York law firm, Patterson Belknap Webb & Tyler, where former attorney-general Michael Mukasey was a partner.

The foundation says the law firm continues to represent it.

Mukasey personally handled at least one matter in court for the foundation.

One real estate dispute in 1981 occurred at a time when reports first surfaced that the foundation, originally set up by the Shah, had been taken over by the new Ayatollah and the Islamic Republic of Iran.

A notice of forfeiture was posted at the skyscraper today, but no tenants were affected, officials said.

Click Here for the Blotter Homepage.

The civil action cites a Reagan era executive order and subsequent Clinton and Bush executive orders as granting the Justice Department the authority to bring the action. The executive orders state that Iran actively supports terrorism as state policy.

It also alleges that the Iranian government used the proceeds of money laundering to acquire assets in the United States, and those assets, which include substantial real estate properties. The action also seeks the forfeiture of those properties.

The complaint is based on an investigation by federal, state and New York City counter terrorism investigators, and cites information seized in a search of the property.

In 2007 ABC News.com reported on the investigation in the past, and noted that the law firm of former Attorney General Michael Mukasey represented the Iranian controlled interests. Read that report here.

Officials say that for more than 25 years, intelligence and law enforcement agencies have suspected the New York-based Alavi Foundation is a \"front\" for Iranian espionage and anti-American activities.

During that time, court records show the foundation has been publicly defended and represented by the New York law firm, Patterson Belknap Webb & Tyler, where former attorney-general Michael Mukasey was a partner.

The foundation says the law firm continues to represent it.

Mukasey personally handled at least one matter in court for the foundation.

One real estate dispute in 1981 occurred at a time when reports first surfaced that the foundation, originally set up by the Shah, had been taken over by the new Ayatollah and the Islamic Republic of Iran.

A notice of forfeiture was posted at the skyscraper today, but no tenants were affected, officials said.

Click Here for the Blotter Homepage.

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