Hezbollah is building a fortified base near the Syria-Lebanon border, the global intelligence company Stratfor reported Wednesday. The site lies near the Syrian city of Qusayr, which Hezbollah, along with the Syrian army and Iran’s Islamic Revolutionary Guard Corps (IRGC), captured from Syrian opposition forces in June 2013. The Stratfor report read, “According to one source close to Hezbollah, the group intends to stockpile artillery weapons [there]…It also plans to move some of its approximately 60 T-72 main battle tanks there.” The site is also reportedly being used to stockpile Shabab-1, Shabab-2, and Fateh-110 missiles, Iranian-manufactured ballistic missiles with ranges of between 200 and 1000 kilometers, putting all of Israel within range. Stratfor continued that the base “could also serve as a location for interaction and training between IRGC and Hezbollah operatives” and is already a hive of IRGC activity, and that Hezbollah has dug tunnels between the site and Lebanon.
Hezbollah has also been busy building up its military infrastructure in southern Lebanon, mostly within civilian areas. At a House hearing last month, Tony Badran, a research fellow at the Foundation for Defense of Democracies, said that in building this infrastructure, “Hezbollah has essentially painted a big target on the back of all of Lebanon.” Badran continued that the placement of more missiles in southern Lebanon “as well as Hezbollah’s entrenchment in Syria and its expansion into the Golan along with the IRGC [Islamic Revolutionary Guard Corps], creates a situation for Israel that will…accelerate upcoming future conflict which…is going to be far bloodier than we’ve ever seen on both sides.” Israeli officials have warned that by moving most of its military infrastructure into Shiite villages in southern Lebanon, Hezbollah is placing Lebanese civilians at risk and using them as human shields. Yaakov Amidror, former Israeli National Security Advisor, has stated, “At the end of the day, it means that many, many Lebanese will be killed.” In January 2015, Israel reportedly hit a convoy carrying high-ranking Hezbollah and Iranian military officials, killing Hezbollah commander Jihad Mughniyeh and IRGC General Mohammad Ali Allahdadi, who were working to build terror infrastructure in the Golan Heights.
“The episode highlights the perils of giving the same address to thousands of shelf-companies – and the lack of rigour in Mossack Fonseca’s due diligence procedures,” The Guardian wrote.
Once the tie to Petropars was exposed, Mossack Fonseca’s managing partner Jürgen Mossack sent an e-mail decrying the lack of adequate checks and insisting that the firm should never do business with “regimes and individuals from such places! Not because of OFAC [the Office of Foreign Assets Control, the US Treasury department that deals with sanctions] but out of principle.”
Petropars, which has offices in both London and Dubai and is controlled by Iran, was essential in obtaining foreign investments for developing the South Pars natural gas field in the Persian Gulf.
Three months after the designation, the law firm’s compliance team recommended dropping Petropars and associated companies. Mossack Fonseca ended its association with Petopars in May 2011.
The firm still maintained ties with other businesses backed by the Iranian regime, however. Through its London franchise, Mossack Fonseca maintained its business with an Iranian outfit called Petrocom, which had a Tehran address and shared Petorpars’ London accountant.
As required, Mossack Fonseca in the British Virgin Islands produced the necessary paperwork to do business with Petrocom. However, when Mossack Fonseca’s main office queried who the ultimate owner of Petrocom was, the London office responded, “I think we could assume that would be Mahmoud Ahmadinejad unless I’m mistaken.” The Guardian observed, “the comment makes it clear Mossack Fonseca’s UK office knew it was continuing to act for state-owned companies.”
The Treasury Department imposed sanctions on Petrocom’s parent company OIIC, which was described as part of a “network of front companies controlled by Iran’s leadership,” in June 2013. The purpose of these 37 front companies, according to Treasury, “is to generate and control massive, off-the-books investments, shielded from the view of the Iranian people and international regulators.” The front companies were controlled by a holding company called Execution of Imam Khomeini’s Order (EIKO).
Despite this, Mossack Fonseca continued its business relationship with Petrocom until December 2015.
American sanctions against Petropars and OIIC ended in January of this year as part of last year’s nuclear deal.
In an op-ed warning against the ending of sanctions on companies like EIKO last year, Mark Dubowitz and Jonathan Schanzer, respectively the executive director and vice-president of research for the Foundation for Defense of Democracies, quoted an Obama administration official who described EIKO as a means for Iran’s leadership to “profit from a shadowy network of off-the-books front companies . . . the Iranian government’s leadership works to hide billions of dollars in corporate profits earned at the expense of the Iranian people.”
According to Dubowitz and Schanzer, the latter of whom is a former Treasury Department official, the sanctions on EIKO were imposed “to shield the US-led global financial sector from Iran’s vast network of financial criminals and their illegal transactions.” Lifting the sanctions on EIKO, they wrote, would mean that “Khamenei will be free to invest billions around the world with impunity.”