Ayatollah Khameini: Crony Capitalist and Slumlord

[by Mark Safranski, a.k.a. “zen“]

Reuters has begun a remarkable series on the economic dealings of Iran’s Supreme Leader, Ayatollah Khameini who controls a staggering fortune of $ 95 billion dollars through a secretive fund Setad that expropriates the property of poor Iranians and religious minorities. This would put the venerable theocrat in the same superclass as Bill Gates, Carlos Slim, Warren Buffet and the Sultan of Brunei .

Up until now, former Iranian president Rafsanjani has always been the face of financial corruption in Iran’s clerical hierarchy, but to paraphrase John D. Rockefeller’s comment about J.P. Morgan, compared to Khameini ” he’s not even a rich man”:

Khamenei controls massive financial empire built on property seizures 

The 82-year-old Iranian woman keeps the documents that upended her life in an old suitcase near her bed. She removes them carefully and peers at the tiny Persian script.

There’s the court order authorizing the takeover of her children’s three Tehran apartments in a multi-story building the family had owned for years. There’s the letter announcing the sale of one of the units. And there’s the notice demanding she pay rent on her own apartment on the top floor.

Pari Vahdat-e-Hagh ultimately lost her property. It was taken by an organization that is controlled by the most powerful man in Iran: Supreme LeaderAyatollah Ali Khamenei. She now lives alone in a cramped, three-room apartment in Europe, thousands of miles from Tehran.

….But Setad has empowered him. Through Setad,Khamenei has at his disposal financial resources whose value rivals the holdings of the shah, the Western-backed monarch who was overthrown in 1979.

How Setad came into those assets also mirrors how the deposed monarchy obtained much of its fortune – by confiscating real estate. A six-month Reuters investigation has found that Setad built its empire on the systematic seizure of thousands of properties belonging to ordinary Iranians: members of religious minorities like Vahdat-e-Hagh, who is Baha’i, as well as Shi’ite Muslims, business people and Iranians living abroad.

Setad has amassed a giant portfolio of real estate by claiming in Iranian courts, sometimes falsely, that the properties are abandoned. The organization now holds a court-ordered monopoly on taking property in the name of the supreme leader, and regularly sells the seized properties at auction or seeks to extract payments from the original owners.

The supreme leader also oversaw the creation of a body of legal rulings and executive orders that enabled and safeguarded Setad’s asset acquisitions. “No supervisory organization can question its property,” said Naghi Mahmoudi, an Iranian lawyer who left Iran in 2010 and now lives in Germany.

The Persian name of the organization that hounded her for years is “Setad Ejraiye Farmane Hazrate Emam” – Headquarters for Executing the Order of the Imam. The name refers to an edict signed by the Islamic Republic’s first leader, Ayatollah Ruhollah Khomeini, shortly before his death in 1989. His order spawned a new entity to manage and sell properties abandoned in the chaotic years after the 1979 Islamic Revolution.

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