US arrests five for multi-million-dollar Iran oil trading scheme
The men were charged over conspiracy and breaching US economic sanctions on Iran
The United States has charged five men with attempting to trade Iranian oil – a direct breach of trade sanctions on Tehran.
In a statement issued on Tuesday, the US Attorney’s Office in Philadelphia confirmed that four men from Texas and one from New York City had been charged in relation to conspiracy and breaching US economic sanctions on Iran.
The arrests appear to be the first American nationals charged since US President Donald Trump imposed sanctions on Iran in 2018 after walking away from the nuclear deal between world powers and Tehran.
The statement on Tuesday said that since last July, the five had tried to buy oil illegally from Iran to sell to a refinery in China. The Justice Department said the charges included one count of conspiracy and another for violating the International Emergency Economic Powers Act as well as violations of US economic sanctions on Iran.
The defendants include Daniel Ray Lane, president of privately held STACK Royalties, LLC a Texas-based company that sells oil and gas mineral rights to investment funds and private equity groups.
Zhenyu Wang, Robert Thwaites, Nicholas James Fuchs and Nicholas Hovan were also charged.
The complaint states they planned to make $28 million (Dh102m) with two shipments per month.
Mr Lane is accused of offering to further the conspiracy by laundering money through STACK Royalties, the Justice Department said. STACK did not immediately respond to requests for comment.
The sanctions breaches would jeopardise the United States’ security, the US Attorney William McSwain said.
"With the goal of illegally enriching themselves, the defendants conspired for over eight months to devise a scheme to violate U.S. sanctions imposed on Iran, particularly the ban on foreign oil sales,” said Assistant Attorney General for National Security John Demers.
The defendants agreed to use a Polish shell company as a straw seller of the illicit oil and planned two shipments of oil per month, according to the charges against them.
he Justice Department said Fuchs and Thwaites agreed to apply for foreign passports in order to set up offshore accounts that would not be reported to U.S. authorities.
If convicted, each of the men could be sentenced to up to 25 years in federal prison and fined as much as $1.25 million (Dh4.5m).
The US administration has ramped up pressure on Iran since walking away from the 2015 nuclear deal as they seek to force Iran’s oil shipments to zero.
While exports from Iran have dropped dramatically since 2018, they are still able to sell oil using clandestine means. Tankers masking their destinations and shutting off their location devices sneak into Iranian waters to load cargo or tankers swap cargo at sea to mask the origins and destinations.
Last year, the UK government stopped and impounded then Panama flagged Grace 1 tanker off Gibraltar accusing it of violating European sanctions on sales to Syria. However, as the tanker was set to be released, the US made a bid to seize it for violating US sanctions on Iran.
The Financial Times newspaper reported that US State Department officials reached out to the captain of the Grace 1 and offered a deal for him to sail to a country that would impound the vessel on behalf of the US.
Updated: February 12, 2020 01:08 PM