Smell Of Iran’s Tea Graft Wafts Wide And Deep
Iranian media is still buzzing with the unfolding details of a colossal corruption case involving nearly $3.5 billion and key Islamic Republic figures.
Iranian media is still buzzing with the unfolding details of a colossal corruption case involving nearly $3.5 billion and key Islamic Republic figures.
The number of officials implicated in the case is so high that the blame game has become very complicated. Iran’s economy is plagued by corruption cases that seem systematic and often work like this: An official with a network of other regime insiders manages to secure foreign currency for international trade at discounted government rate and then sells it in the black market.
Whenever such cases are revealed, the authorities usually cope out of responsibility by blaming former administrations or officials from the opposing political camp. However, the $3.5 billion embezzlement case of Debsh Tea Company involves officials from both the current and the previous presidential administrations -- including ministers of agriculture, industry as well as the governors of the Central Bank of Iran and the chiefs of Iranian Customs Administration. It has also led to discord between the judiciary and the presidential administration as well as the parliament.
Apart from the accusations of corruption between reformist and conservative factions, the government and the judiciary also disagree on how to manage the scandal. President Ebrahim Raisi has called for this case not to become "political," a code in Iranian politics for burying an issue. Raisi called for the coverup after reports revealed his administration’s part in the case. Some reports say that until 2020 the annual budget allocated for importing tea was around $300 million, but the budget suddenly tripled in 2021 without any justification. Iran International has also learned that former Agriculture Minister Javad Sadatinejad, was removed by Raisi in mid-April in relation to the case.
Debsh company, handling most of the country's tea imports, received a staggering $3.37 billion in foreign currency from the government on a preferential exchange rate for tea and machinery imports from 2019 to 2022. However, it has allegedly sold $1.4 billion of the currency on the free market at a higher rate. The company also sold low-grade tea imported from Kenya as high-grade tea originating from India, with a $12 difference per kilogram. The company has been also involved in what has been described as fraud by re-importing cheaper Iranian tea and pocketing the difference in foreign currency.
Iran’s Chief Justice Gholam-Hossein Mohseni-Eje said Thursday that "The government has reported the dismissal of 60 individuals in this case, but these individuals have not been named." A few hours later, government spokesman Ali Bahadori Jahromi said that the dismissal of 60 managers in the past two years is not only over this particular case. Jahromi said earlier this week that several low and mid-ranking officials have been arrested over the case. The CEO of the company, Akbar Rahimi, is reportedly under arrest too. No reports about the details of these arrests and dismissals have been shared with the media and it is not even known if any court hearing was held.
Although top officials, including Supreme Leader Ali Khamenei, claim that corruption in the country is not systematic, the case of Debsh tea company could not have been allocated $3.5 billion while the total consumption of tea barely hits $300 million. According to former editor of conservative Kayhan daily, Mehdi Nasiri, such a large amount of corruption is not possible in Iran without the involvement of top officials and Khamenei's office.
The scandal has enraged Iranians who are suffering from a wide range of economic problems as well as shortages of medicines and some food items as the government has failed to lower inflation, currently above 50 percent.
Iran's top Sunni cleric Mowlavi Abdolhamid said during his Friday sermon that Islamic Republic officials acknowledge the extensive prevalence of corruption, which has reached a point where they are unable to curb or eradicate it. He stressed the necessity for fundamental changes to combat corruption, echoing the people's outcry that past policies have proven ineffective. The outspoken leader of Iran's Sunnis referring to the tea scandal said, "Corruption has become so widespread that some have dared to embezzle this amount for themselves."
Underlining that such a huge corruption case is not possible without the knowledge or coordination of senior officials, reformist Etemad newspaper says, “The main problem is that, aside from a general headline, no details have been released about the highest authorities involved.”
Ehsan Khandouzi, speaking to university students, reluctantly admitted that successive administrations have mishandled the economy, but insisted that US sanctions imposed in 2018, wiped out economic growth and “led to today’s high inflation.”
“The sanctions during the Trump era caused the country's economy to decline, and inflation is now the legacy of the sanctions in recent years. These sanctions have affected the purchasing power of households,” Khandouzi insisted.
No one truly knows the real annual inflation rate, since the government stopped issuing periodic reports in 2019, but occasional figures announced by officials show that inflation is above 50 percent, and food prices have increased much faster.
Khandouzi referred to 2011, when he said the national income had reached an all-time high, but he did not mention that skyrocketing oil prices were the reason why the country had disposable income more than a decade ago. In contrast, currently there is not enough foreign currency to import raw materials for producing medications and people must go from pharmacy to pharmacy to find a can of baby formula.
One student asked the minister if “you want to drag everyone into poverty,” to which the minister gave a condescending answer. “When I was a student like you 25 years ago, I was also a critic, but one expects students to ask more sophisticated and analytical questions,” Khandouzi replied. He then went on to tell the students that the ministry of economy has set up a summer school and they are welcome to attend the courses and learn economics.
Meanwhile, the minister admitted that the Islamic Republic in the past 20 years has completely mishandled its banking sector and now several institutions are on the verge of bankruptcy. He also acknowledged that the government is afraid of protests if banks go under, and depositors demand their money. For this reason, the government prefers to dissolve these institutions into the Central Bank of Iran, a strange arrangement for any country.
However, Khandouzi did not mention that there no true private sector banks in Iran. The so-called non-governmental banks are in fact institutions set up by public entities or by regime insiders who have political influence and therefore have immunity from supervision.
Insider dealings became once again public scandals this week. A company dealing with tea imports misused up to $3.5 billion it received from the government at preferential rate of exchange. Instead of importing tea and machinery as expected, the company sold dollars on the open market at much higher rates. Despite pledges by top officials to investigate and address the fraud, so far, no prominent person has been detained. Some local media outlets say that without the complicity of top officials such a fraud would not have been possible.
At the same time, members of Tehran’s municipal council are asking about more than $300 in city revenues that has “disappeared”, meaning there is no trace of the money in budget allocations. This is a substantial sum of money in Iran, equaling 170 trillion rials.
The minister of economy did not address the corruption scandals during his meeting with the students. He tried to argue that the economy has improved in the past two years during the reign of hardliners. President Ebrahim Raisi also presented rosy figures to parliament earlier this week. One lawmaker commented after the meeting that “The president seemed to be talking about a different country.”
The Canada-based non-profit has urged the international community to investigate this type of torture and deaths resulting from it in Iran. “The Islamic regime in Iran must be held accountable for its crimes against political prisoners,” a recent report by CFPPI, said.
Pharmacological torture is the use of psychoactive, psychotropic drugs or other types of drugs to punish, extract information, or to subdue prisoners into compliance by causing distress in the form of pain, anxiety, panic, psychological disturbances, immobilization, hallucination, paranoia, disorientation, and addiction without leaving obvious physical signs of violence.
CFPPI has said in its report that it conducted extensive investigations that indicated an alarming increase in the use of pharmacological torture in Iran in the past five year and particularly since Women, Life, Freedom protests that began in late September 2022. Their findings draw on testimonies of those arrested during the protests of 2022-2023 as well as on the accounts of former political prisoners.
According to CFPPI's report, the regime has intentionally and systematically subjected more political prisoners to pharmacological torture by sending detainees to mental hospitals and forcibly administering anti-psychotic drugs at multiple prisons across the country, as well as by mixing drugs into their food and drinks.
“Whereas formerly, prison guards would offer sedatives to prisoners, which many of the younger and newer prisoners voluntarily accepted to ease their experience, new reports suggest that since September 2022 the practice has changed to violent and coercive administering of unwanted drugs,” the report said.
One of the victims interviewed for the report, a 27-year-old woman who said she had been raped several times during her detention, told CFPPI that she was forced into taking unidentified pills which had a profound impact on her, leading to psychotic episodes. After her release from prison, she attempted to take her own life and lost one of her kidneys.
Prisoners say they have also noted serious pains and aches in the absence of the drugs.
Dissident rapper Saman Seydi (Yasin) is among political prisoners who have spoken up about their tortures including administration of unidentified pills and injections at a very high cost. He has been sentenced to death and is still in prison.
Yasin was held at a mental hospital on the orders of the notorious judge Abolghasem Salavati for four days as punishment for smuggling out an audio file from Tehran’s Evin Prison in which he described tortures including being subjected to mock execution.
At the mental hospital where he was tied to the bed, security forces beat him for refusing to allow them to inject him with an unknown substance. Yasin claims he fell unconscious for 24 hours after the injection and has been having problems with his eyesight and balance since then.
Yasin’s torturers, he says, wanted to force him to “confess” to possession and use of a firearm during last year’s protests.
In several other cases in the past year, detainees including young protesters have died soon after their release from prison under suspicious circumstances.
Pressure on victims’ families to accept “suicide”, “sudden death”, or “overdose” as cause of death of individuals with no prior record of major health problems, depression or addiction has raised suspicions that the deaths may have resulted from pharmacological torture.
“Pharmacological torture is extremely distressing and punitive as it causes severe physical pain, harmful and painful physiological changes, confusion, perceptual abnormalities, fearfulness and anxiety, lethargy, and loss of personal agency,” William Hopkins, Consultant Psychiatrist at Freedom from Torture who has worked to rehabilitate survivors of pharmacological torture from various countries is quoted by the report as saying.