Slovenia Opens Investigation into Iran-related Money Laundering Scandal

Published: 02 October 2017

Nova Ljubljanska banka logo.svgNova Ljubljanska Banka (Photo: Wikimedia Commons)

By Vanja Lakic

Slovenia has launched an investigation into allegations that its biggest state-owned bank laundered nearly €1 billion (US$ 1.17 billion) from Iran between 2008 and 2010, Euractiv reported Monday.

The centre-right Slovenian Democratic Party, SDS, claims that Iran has used Slovenian laundered money to buy materials needed to build atomic and chemical weapon components, pay the agents who executed the purchases, and infiltrate Iranian spies in nuclear, security and defence institutions in the EU and the US.

Opposition parties led by the SDS suspect that after authorities in Switzerland shut down his accounts at UBS, British citizen Iraj Farrokhzadeh opened accounts at Nova Ljubljanska Banka (NLB) for the company Farrokh Ltd. and moved money for Iran’s Export Development Bank which is blacklisted over its connection to weapons proliferation and payments to companies run by Iran’s defense ministry.

The Bank of Slovenia ordered a ban to the transactions in December 2010, which NLB took nine days to implement. This gave Farrokhzadeh, who was on Interpol’s most wanted list at the time, enough days to move his operations to Russian banks, according to Euractiv.

The Slovenian government confirmed that it had received a suspicious transaction report in June 2010 in relation to money laundering and terrorist financing.

Slovenian media reported in July that 40-50 transactions took place every day from NLB bank to more than 30,000 accounts around the world, including some held under dodgy names such as Donald Duck and Mickey Mouse.

The case wasn’t further investigated until the opposition reopened it last week.

“While British, French, Italian and other investigating authorities, tried to investigate the Slovenian money laundering scheme, their Slovenian counterparts and the political leadership at the time did everything they could to sweep the operation under the rug, hide it from the Slovenian public and the international institutions and enable further transactions for the Iranian regime,” SDS wrote in a statement last week.

The party also suspects that the transactions were backed by politicians arguing that it’s highly unlikely that all the control mechanisms, and law enforcement authorities could have simultaneously failed to handle the situation.

Slovenian Prime Minister Miro Cerar said that the money laundering allegations involving NLB bank have not been confirmed or rejected yet.

“If there were some irregularities or abuse, we have to confirm them beyond doubt and then punish,” he said. “If it is established that someone is responsible for this in the eyes of the law, appropriate procedures will be launched.”