On January 5, 2021, the US Department of Justice announced the collection of $7 million as part of a civil forfeiture investigation into the transfer of approximately $1 billion of Iranian-owned funds in violation of US sanctions against Iran.
According to the DOJ, three Iranian nationals and one US citizen conspired, between 2011 and 2014, to defraud South Korean banks of approximately $1 billion by submitting false documentation to demonstrate legitimate business involving Iranian and South Korean companies. The three Iranian nationals, although not charged in the conspiracy, have been designated by the Office of Foreign Assets Control of the US Department of the Treasury pursuant to Executive Orders 13224 and 13382. The US citizen and his son have been indicted in the US for violating the International Emergency Economic Powers Act and the Iranian Transaction and Sanctions Regulations, and for laundering nearly $1 million of Iranian-derived funds. The father, Kenneth Zong, is currently in South Korea where he recently completed a prison sentence for violating South Korean law in connection with the conspiracy, while the son, Mitchell Zong, was sentenced in the US in 2018 for his role in the money laundering scheme. At the same time, a forfeiture complaint was filed against the Zongs, resulting in an order to forfeit approximately $10 million in assets purchased with funds attributable to Kenneth Zong’s IEEPA violations in South Korea.
A second forfeiture complaint was filed against approximately $20 million held in the United Arab Emirates that, according to the DOJ, are traceable to the sanctions evasion scheme and formed part of a down payment on the purchase of a hotel in Tbilisi, Georgia in 2011 and 2012. The resolution confirmed by the parties in a joint stipulation filed with the court allots $6 million in cash and $6 million in waived interest to Ras Al Khaimah Investment Authority, $7 million to V12 Partners GMBH, and $7 million to the United States. The US’ portion will be allocated to the US Victims of State Sponsored Terrorism Fund established by congress to provide compensation to individuals injured by acts of state-sponsored terrorism.