Media Note
Office of the Spokesman
Washington, DC
December 17, 2008

Today, the Department of the Treasury, in consultation with the Department of State, designated under Executive Order 13382 two Iranian entities of proliferation concern: ASSA CORP., a front company created and controlled by Iran’s Bank Melli and domiciled in New York, and its parent company ASSA CO. LTD, located in the Channel Islands. Both entities were designated for being controlled by and/or acting on behalf of, Bank Melli. In a related action, the Department of Justice filed a civil forfeiture action seeking to forfeit all right, title and interest of ASSA CORP., ASSA CO. LTD, and Bank Melli in a Manhattan office tower on Fifth Avenue.
Bank Melli was designated by the United States under Executive Order 13382 in October 2007, was identified in UN Security Council Resolution 1803 as a bank of proliferation concern warranting greater scrutiny, and was designated by the European Union in August 2008 for its support for proliferation. Bank Melli provides financial services, including opening letters of credit and maintaining accounts, for Iranian front companies and entities engaged in proliferation activities.
As a result of Treasury’s actions today, all property and interests in property of ASSA CORP. and ASSA CO. LTD that are in the United States, that hereafter come within the United States, or that are or hereafter come within the possession or control of U.S. persons, are blocked and may not be transferred or otherwise dealt in. ASSO CORP. co-owns a property on Fifth Avenue in Manhattan with the Alavi Foundation of New York, a non-profit Iranian charitable organization. The Alavi Foundation, originally known as the Pahlavi Foundation, was created under the Shah of Iran in the 1970s. It later changed names to Bonyad Mostazafan after the 1979 Iranian revolution and then changed names again to the Alavi Foundation.

Wednesday, December 17, 2008

By Lee Ross

Federal authorities moved in Wednesday to seize control of a New York City office building partially owned by a company with ties to the Iranian government.

The move by officials at the Treasury and Justice Departments is designed to stop the flow of funds they say are used to helpIran‘s efforts to build nuclear weapons.

The office tower, located on New York’s famed Fifth Avenue, was built by an Iranian non-profit group in the 1970s. Over the years the ownership of the building has evolved into what federal officials say is an attempt to hide the stake held by an Iranian state-owned bank.

The government alleges that Assa Corp., the building’s owner, is a shell company for Bank Melli, which is accused of facilitating the movement of nuclear materials for the Iranian government. Officials contend that Bank Melli was heavily involved in the day-to-day operations of Assa Corp. and its management of the Fifth Avenue building, which generated rental income that was sent back to Iran.

Although Treasury is now designating Bank Melli a front company for the Iranian government, it pointed out that the building houses legitimate tenants, including Merrill Lynch.

This designation does not interfere with the business and other activities of the tenants of 650 Fifth Avenue, Treasury said in a press release. People in the U.S. are not prohibited from dealing with business establishments or other tenants of the building.

An executive order signed by President Bush last year froze all Bank Melli assets in the United States. In October, the FBI seized a pair of Assa’s bank accounts that held $3.1 million.

The sole employee of Assa, Mohammad Hassan Dhghani Tafti, engaged in a number of curious moves to apparently hide his employment status. His access to Assa accounts drew added attention from federal authorities. Between 2000 and 2007 more than $17 million was deposited into one of the seized accounts.

“This scheme to use a front company set up by Bank Melli — a known proliferator — to funnel money from the United States to Iran is yet another example of Iran’s duplicity,” said Stuart Levey, Treasury Undersecretary for Terrorism and Financial Intelligence.

Bank Melli is known to handle funds for the Iranian Revolutionary Guards Corps and its Quds Forces. Those groups are believed to help fund activities tied to the Taliban, Hizballah, Hamas and Palestinian Islamic Jihad