Diplomats for sale: how an embassy was bought and lost |

0
771

His image, the tailored suits, silk ties and handmade shoes, was all for Ali Reza Monfared.

Then, when he fell from his splendor of characteristic dress to the light blue uniform of Iran's famous Evin prison, the contrast was harsh.

His well-groomed hair has also turned gray since the Iranian international police arrested him at a Caribbean resort in 2017.

In November 2019, Monfared was convicted of embezzlement of millions of dollars from his country, only one of the threads in a worldwide network of financial, diplomatic and personal fraud that saw him sentenced to 20 years in prison and a fine of $ 1.3 thousand millions.

It could have been worse. In 2016, Monfared's billionaire business partner, Babak Zanjani, was sentenced to death for his role in diverting $ 2.8 billion of Iranian oil revenues.


For more information on the legal passport trade and some of the difficulties, see our podcast Al Jazeera Investigates: Diplomats for Sale.


Monfared's charisma and natural hustle had taken him far. From his humble beginnings in the home decoration business, he had shot to success: banker, international oil trader and, finally, "His Excellency Dato Ali Reza Monfared,quot;, Dominica's ambassador to Malaysia.

In 2015, Monfared had obtained a Dominican diplomatic passport and, with it, what he treasured most: diplomatic immunity.

A charismatic stranger

In 2012, Monfared arrived in Labuan, a small island in Malaysia off the coast of Borneo, like a charismatic stranger with great ambitions.

"You would practically fall in love with him because he talks a lot. Ali can convince anyone to do something," said Manoj Bhullar, owner of a marine logistics company in Labuan. He refers to Monfared as "Ali,quot; because they were once best friends.

When they met in 2012, Monfared claimed to be an agent of the Iranian government, working, under the direction of Babak Zanjani, to get oil out of Iran.

Since Iran was under sanctions, "they had problems," Bhullar explained.

When Bhullar proposed a solution to these problems, it marked the beginning of a relationship that would change his life.

Diplomats for sale longread

Bhullars

The first time I heard about Monfared was in the summer of 2018. He was interested in selling diplomatic passports in the Caribbean and had begun to gather sources through a contact connected with Bhullar's wife, Kiran. She and her husband had been scammed by Monfared and Kiran sent me long text messages about their search for justice.

His story was convincing, so I asked to meet in person. But although it was clear that he wanted to speak, he seemed reluctant to meet.

He finally agreed, but made no promises. Then, with correspondent Deborah Davies and cameraman Manny Panaretos, I traveled to Kuala Lumpur without guarantee of an interview.

We met the Bhullars for lunch in a mall.


Do you have a tip for Al Jazeera that should be investigated? Find out how to contact us on our Tips page


"You draw a mental image of the people you are going to meet," Davies said later. "(Then) enters this really elegant, charismatic and fabulous looking couple." It was easy to see how the Bhullars would have fit in with Monfared's glamorous lifestyle.

Later, Bhullar told me that he also had a mental idea of ​​how lunch would develop: he would sit down, shake hands, politely refuse to speak, and then leave.

But that was not what happened.

Instead, the couple released years of accumulated frustration and regretted their dealings with Monfared.

When our meeting entered its third hour, the conversation turned to Labuan. I told them that I had often heard him describe as the Cayman Islands of Asia, due to its flexible financial rules and many ghost companies. I had wanted to visit but they had told me that, as a reporter, it would be impossible.

The Bhullars rejected my concerns and invited us there. "It's my island," Bhullar joked. And from the moment we arrived, he felt that way.

Labuan

Labuan is the best natural harbor in Borneo. In fact, it means "port,quot; in Malay. That is why people have been fighting for it for years. The Japanese took it during World War II and many Allied soldiers died trying to recover it.

This is not history for Bhullar, it is family tradition.

"My grandfather was involved in the Punjab Regiment … Sixty-seven of them were sent to Labuan to fight the Japanese for themselves. Only four survived. My grandfather was one of them," he explained.

His grandfather decided to stay.

Standing at the Labuan jetty, Bhullar was at home and at ease. He left the businessman with problems we met in Kuala Lumpur.

"From a very young age, Dad interested us in the sea," he explained. "I had a boat. He asked us to jump off this pier here and we had to swim to the island up there."

Bhullar's marine services business was working well when Monfared arrived on the island. And, for a while, the business improved even more when Monfared tried to find a way to avoid sanctions against Iranian oil.

Diplomats for sale longread

Deborah Davies, Al Jazeera reporter with Manoj and Kiran Bhullar (Kevin Hirten / Al Jazeera)

It was Bhullar who offered him a solution. He had learned of a small escape, or at least an unproven area, in the law: if oil was stored on the high seas for a certain period of time, it ceased to be oil from the country of origin and became "Malaysian,quot; oil ". And there were no penalties on that.

It was not long before Monfared and Bhullar carried out a massive supply and storage operation from the port of Labuan.

"The ships would come from Iran … We had tankers parked just outside here. The mother oil would come in, dump her oil into our tankers and leave and we would have all the oil stored in the bay here," Bhullar explained.

"Each oil tanker would bring … from one million to two million barrels."

His company had eight storage units throughout Malaysia, where they waited for ships to arrive to extract stored oil and navigate to China, where it was to be sold.

For a while, it worked. Bhullar did the marine logistics and Monfared handled the money. Then, in 2013, Zanjani was arrested.

The operation was closed, but the Bhullars and Monfared were still close friends, sharing family meals and vacations.

A financial center of a small town

To understand the tangled relationships that ruined the lives of the Bhullars, it is helpful to understand Labuan.

First, it is small: about 93 square kilometers (36 square miles). The southern half of the island is the most developed, with some high-end hotels that house oil workers and international entrepreneurs. Overlooking the harbor, in the center of the city center, there is an imposing financial complex that houses more than 6,500 offshore companies.

It is an ideal place for an operator like Monfared: it is out of the way, the island's economy is heavy in international finance, oil and gas, has a low tax rate and operates under the protection offered by Malaysia, which means that it benefits of double taxation agreements, a variety of tax exemptions, signed with 70 other countries, according to Dezan Shira & Associates

It is simultaneously a financial center and a small city.

I kept thinking why you should be afraid, if you're not guilty.

Manoj Bhullar

Labuan's easy sense of community can explain why Kiran found it so hard to believe that Monfared was not doing anything good. "He was very sweet with everyone, his sister always called me," he explained.

"He was closer than a family member," Bhullar added.

When Zanjani was arrested, Bhullar said Monfared was scared. "I kept thinking why you should be afraid if you're not guilty?"

But as the schemes of the oil scheme and embezzlement became clear to the Bhullars, they understood that his friend was in trouble.

The Commonwealth of Dominica

By summer 2014, Monfared had moved temporarily to Spain. Even so, the Bhullars remained close to him and, in August, the two families went on vacation together in Panama. It was during those vacations that Monfared proposed that he and Bhullar make a quick trip to the Commonwealth of Dominica.

"Just before landing at the airport, while we were still in the air, that was when Ali told me the reason. He has requested a program to obtain citizenship for him and his whole family."

Dominica is an island in the Lesser Antilles, a vertical strip of eastern Caribbean islands that cascades into South America. It is volcanic and wild, with steep peaks that dramatically protrude from the sea. But lacking the perfect beaches of its neighbors, it struggles to attract tourists and is one of the poorest countries in the region. It is also one of the least touched by development.

It may take approximately 90 minutes to reach the country's capital, Roseau, from the airport. Winding through the narrow mountain roads, Bhullar said he was impressed by the tropical air and the lush landscape. It reminded him of his home. But, while still on vacation mode, Monfared was a business, preparing for a meeting the next morning with the country's Minister of Investment Citizenship (CBI).

Monfared's goal was to ensure citizenship for his family. It is perfectly legal and very common, usually costs between $ 200,000 and $ 300,000. The money goes to private projects, such as hotels, or infrastructure. It can be a great source of income for the small islands of the Caribbean.

Diplomats for sale map2

On the taxi ride from the airport, Bhullar spoke with the driver. As an island companion, he recognized the problems that the driver described: periodic shortages of food, water and electricity.

Bhullar helped prepare his friend for the next day's meeting.

"I just told Ali … & # 39; At your meeting … what they will ask you is simple, what benefit will we get by giving you citizenship? & # 39;"

Monfared suggested offshore banking, but Bhullar urged him to play the essentials of the island, which he did.

At their meeting, Monfared presented several investment ideas, including aquaculture and geothermal energy projects. All this came with the promise of strong commercial and political ties with the Malaysian government.

Bhullar recalled that "Ali returned screaming to my room at 10:30 in the morning and said & # 39; Get ready! & # 39;"

"I said & # 39; why, what's going on? & # 39;"

"He said:" I said what you asked me to say and asked me to explain. I don't know anything to explain and I informed you that my business partner … is here, he will explain to you ""

Bhullar hurried to dress when Monfared added that the meeting was no longer with ministers; It was with the Prime Minister of Dominica, Roosevelt Skerrit.

"I went to the Caribbean in shorts and T-shirts. I had to borrow a shirt and pants from the reception," he said, recalling the absurdity of the situation.

Bhullar has a picture of the three gathered in the prime minister's office that day, Bhullar with a badly fitting shirt.

Diplomats for sale - Alireza and Skerrit 2

From left to right: Ali Reza Monfared, Dominican Prime Minister Roosevelt Skerrit and Manoj Bhullar (Manoj Bhullar / Al Jazeera)

Towards the end of the meeting, Bhullar received his second surprise of the day. Bhullar said Skerrit made an offer, not to Monfared, but to him.

"He said & # 39; why aren't you our ambassador in general? & # 39;"

"I said & # 39; No, I am a businessman, not a politician & # 39;" Bhullar explained.

Prime Minister Skerrit told Al Jazeera that he has no memory of this meeting.

Back at his hotel, Bhullar said Monfared had an idea: "Convince them that I can do the part."

According to Bhullar, he and Monfared had breakfast with the IWC minister, Emmanuel Nanthan, the next morning. Bhullar recommended Monfared to the post of ambassador and Nanthan seemed satisfied with that, as long as he brought much-needed investments to the island. However, the final decision on these matters depends on the prime minister.

Things moved quickly after that. Monfared had its meetings in Dominica on August 26, 2014. A week later, he had registered three companies there.

On September 3, his family received his naturalization paperwork and became a citizen of the Community of Dominica.

My Dominica Trade House

One of the first things Monfared did when he returned to Malaysia in September 2014 was to start a new company, with the Bhullars as partners.

At first glance, the company tried to facilitate trade and investment between Malaysia and Dominica. Actually, it was about getting a diplomatic passport for Monfared.

In a month, Dominican government officials were visiting Malaysia, with all expenses paid. The funds came from the chests of the new company, My Dominica Trade House.

Bhullar showed us a great green book detailing the brief but historical history of a company so notorious that one day it would become the title of a calypso song of political protest. The bright photos inside showed a series of elegant receptions for prominent Dominican delegates, smiling and toasting with a radiant and impeccably dressed Monfared.

We don't use the word bribe … But, definitely … without that money, Ali wouldn't have obtained his diplomatic passport.

Manoj Bhullar

It was not long before Monfared bought a property according to his new role as a future ambassador. The Bhullars say it was paid by the company. Located on a lake in an exclusive neighborhood of Kuala Lumpur, it would become the Monfared embassy.

By mid-October 2014, Monfared had received his official diplomatic passport application and, shortly thereafter, began receiving payment applications. The key person for this was Minister Nanthan.

Bhullar said Monfared had understood that his diplomatic credentials would involve some payments to Dominica. But they quickly exceeded their expectations.

On October 29, 2014, two emails arrived with two bills to help with the next Skerrit election campaign. One went for $ 85,000 to print the party manifesto. The other was for $ 115,000 for billboards, a sound system and fireworks.

Diplomats for sale Longread

A screenshot of the now disappeared website of My Dominica Trade House (Al Jazeera)

But not all were payments related to the campaign. In November, Nanthan requested another $ 200,000.

Bhullar was in charge of organizing the payments and recalled how there was a delay in this case. "We had a problem transferring the money to your company's account, which is the gas station in Dominica," said Bhullar. "It took us almost four or five days."

According to the emails provided to Al Jazeera, the payment of $ 200,000 was sent to a bank account for a service station owned by the Nanthan family in Portsmouth, at the northern end of Dominica.

Nanthan was upset when the money did not arrive on time. In an email, he wrote: "I'm still waiting for routing instructions. This is taking forever. I must say that it lacks the efficiency that Dato Ali and his organization showed me. I'm extremely disappointed."

"Oh, we received emails, phone messages, phone calls. He kept on, you know, insisting … & # 39; when will we get the money? & # 39;" Bhullar recalled.

There are many photos of Nanthan in the big green book.

"We don't use the word bribe … But, definitely … without that money, Ali would not have obtained his diplomatic passport," Bhullar said.

In early December, five months after the initial meetings in Dominica, Monfared received what he had been waiting for: a signed letter from the prime minister offering an embassy.

The appointment raises questions, not only because it happened immediately after an election for which he helped pay, but also for the due diligence that the Dominicans carried out because at this point, Monfared's business partner, Zanjani, had been arrested and The First Islamic Investment Bank, of which Monfared was the authorized signatory, had been sanctioned by the United States and the EU.

Monfared sent his "voluminous thanks and thanks,quot; to Skerrit, promising "to firmly develop the bilateral relationship and diplomatic ties between the Community of Dominica and Malaysia."

The next step was to plan the biggest party to date, to welcome the Prime Minister to Malaysia. Skerrit wanted the company to pay for him to travel to Malaysia and then to meetings in China on a private plane. Monfared agreed.

In March 2015, Skerrit landed in Malaysia. No expenses were saved. They picked him up from the airport in a Rolls Royce. The reception for him featured champagne, food and a jazz band. It was there that Skerrit handed Monfared his diplomatic passport.

Diplomats for sale longread

Dominican Prime Minister Roosevelt Skerrit, left, and Ali Reza Monfared (Al Jazeera)

Ambassador Monfared

"After obtaining (his) diplomatic passport, he completely changed his attitude," Kiran said.

"I couldn't call him Ali anymore," Bhullar explained. "He said & # 39; No, you have to call me Excellence & # 39;".

Monfared spoke openly with Bhullar about why the diplomatic passport was so important to him. "He told me … & # 39; I have diplomatic immunity … I don't have to worry about the Iranians & # 39;".

One night, at the offices of My Dominica Trade House, Monfared had his first opportunity to prove the power of his diplomatic passport. Police responded to reports of drug use at an office party.

Bhullar related how he saw how two police vans with about 20 officers stopped outside. According to Bhullar, Monfared hid behind a door, waving his diplomatic passport and saying: "You can't arrest me, I'm a diplomat."

Monfared - Diplomats for sale

Dominican passport of Ali Reza Monfared (Al Jazeera)

"I asked (the police) & # 39; What happened? Did they find any drugs? & # 39;" Bhullar explained. "The police said: & # 39; Oh, we could not enter the room. He is a diplomat … This is outside our jurisdiction & # 39;".

In addition to giving him a new sense of invincibility, the Bhullars said the passport seemed to encourage all kinds of erratic behavior.

Monfared had a lake behind his house where Kiran said he wanted to create a bird sanctuary. She said he ordered 1,500 ducks and parrots caged macaws and other birds.

The ducks, he said, would roam the neighborhood. "The complaints kept coming, without stopping."

Game over

By December 2015, Monfared's luck was running out.

Zanjani's trial began and the Iranians issued an arrest warrant against Monfared. Malaysian authorities picked him up, but his diplomatic passport literally took him out of jail.

"He was released on the condition that he should not leave the country and his home," Bhullar explained.

Monfared decided to save himself by betraying his friend. He sold the property, which according to the Bhullars belonged to the company, and, using his diplomatic passport, escaped to Dominica, leaving the Bhullars with their debts.

"It was a horrible moment," Kiran said, explaining how her family's reputation was destroyed, her savings disappeared and her husband was arrested for a while.

The police said: & # 39; Oh, we couldn't enter the room. He is a diplomat … This is outside our jurisdiction.

Manoj Bhullar

In Dominica, Monfared quickly surpassed his welcome after his luxurious lifestyle exhausted unpaid bills. After six months, he went to the Dominican Republic, where he hid in a spa called Boca Chica.

Back in Malaysia, the Bhullars had heard that Monfared had left Dominica, but no one knew where. Then, one day, Bhullar noticed that Monfared's lawyer in Malaysia had posted on Facebook that he had entered a resort in the Dominican Republic

"I sent money (to a local taxi driver in Boca Chica). I said: & # 39; Here you go, $ 200, go to this resort and see if you find a man named Ali Reza Monfared, an Iranian man & # 39 ;. "Bhullar explained.

The taxi driver confirmed that Monfared was there.

Bhullar called the Iranian authorities. Shortly after, Monfared was picked up and transported to Iran.

"(It was) bittersweet," Bhullar said. "(But it felt) a lot (like) justice."