Iran’s Supreme Leader, the Nuclear Deal, Protests and Boeing

Posted on January 9, 2018January 9, 2018 by Denise Simon

It is the conglomerate that the Supreme Leader, the Ayatollah Khamenei owns exclusively. “Setad Ejraiye Farmane Hazrate Emam,” or Setad.

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Setad was originally sanctioned by the U.S. Treasury in June 2013. The conglomerate “produces billions of dollars in profits for the Iranian regime each year,” said David Cohen, then the Treasury’s under secretary for terrorism and financial intelligence, at a Senate banking committee hearing that year.

Setad, Cohen said at the time, controls “massive off-the-books investments” hidden from the Iranian people and regulators.

All entities sanctioned for being part of the Iranian government are being taken off the SDN list as part of the nuclear deal, also called the Joint Comprehensive Plan of Action (JCPOA), though U.S. persons and entities will still be banned from dealing with them.

In January of 2017, a review by Reuters noted: But a Reuters review of business accords reached since then shows that the Iranian winners so far are mostly companies owned or controlled by the state, including Iran’s Supreme Leader, Ayatollah Ali Khamenei.

Of nearly 110 agreements worth at least $80 billion that have been struck since the deal was reached in July 2015, 90 have been with companies owned or controlled by Iranian state entities, the Reuters analysis shows.

In December of 2017: Treasury Department officials must publish a report chronicling the financial assets of Iran’s top leaders, under a bill that passed the House on Wednesday.

The legislation, which passed 289-135, must still clear the Senate before President Trump can sign it into law. It’s a potential boon to Iranian dissidents against the regime, who stand to gain insight into corruption by top officials.

Podcast – Upheaval in Iran: Causes and Consequences

Meanwhile, as the protests continue in Iran against the regime and rightly so, questions arise due to not only Senate votes on sanctions but staying with the Joint Comprehensive Plan of Action, meaning the Iran nuclear deal.

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Why is there even a question based on additional facts surfacing in the last year? Well, the left and those that remain with John Kerry and Barack Obama are adding new pressures to stay in the JCPOA. Further, complications arise from those countries that are also part of the deal. They too want the deal sustained.

In a story titled “U.S. security experts back Iran nuclear deal, as Trump faces deadlines,” Reuters reports that a coalition of national security experts want the president to continue the Iran deal. The report claims, without any context, that all of the people who signed a letter in favor of the deal are “national security experts.” Additionally, these “experts” are from an organization called the “National Coalition to Prevent an Iranian Nuclear Weapon.”

It turns out, however, that some of those listed on the document have severe conflicts of interests, none of which were disclosed in the letter.

It also turns out that the National Coalition to Prevent an Iranian Nuclear Weapon is not an actual organization. A Google search of the group turned up nothing before Monday. The group was created this week with the apparent purpose of garnering support for the nuclear deal. None of this is reported in the Reuters article. It is only revealed through the group’s statement provided on The National Interest website.

The outfit’s title also presumes its members are national security hawks, when this is far from the case.

Members of the “National Coalition” include a who’s who of the prominent organizers of the campaign to rally support for the Obama administration’s nuclear deal with Tehran.

Included on the list is Joseph Cirincione, who served as the money man for President Obama’s Iran “echo chamber.” Cirincione has admitted to paying off a “network of 85 organizations and 200 individuals” who were “decisive in the battle for public opinion” over the Iran deal.

Gary Sick, another signee, was one of the chief organizers of the Iran echo chamber. According to the Washington Free Beacon, Sick created an invite-only listserv to distribute pro-Tehran talking points to Obama-friendly journalists and influential figures.

The coalition also includes Ambassador Thomas Pickering, who is a paid lobbyist for Boeing. The aviation company is attempting to secure a multi-billion-dollar jetliner deal with the Iranian regime. If the Iran deal falls through, so does Boeing’s deal.

Paul Pillar, a disgraced former CIA officer who was also on the letter, once drafted talking points arguing that it’s not a big deal if Iran is able to develop a nuclear weapon. “If Iran develops a nuclear weapon, the United States and the West could live with it, without important compromise to U.S. interests,” he wrote, according to Eli Lake of Bloomberg News.

It remains a mystery what President Trump will decide this time around. He has been troubled by Iran’s violent response to countrywide protests. The president has leveraged social media and several executive departments to raise awareness about the plight of Iranian protesters. He has also mulled enacting further sanctions against the regime.

As an aside, there too is pressure from Boeing, they want to protect the sale agreements of planes to Iran such that they have offered to ‘finance’ the payments, essentially layaway. Iran is looking for a method to make payments of $44B to both Air Bus and Boeing. Humm….but that Supreme leader has a major conglomerate remember?

Iran/Turkey Evade Sanctions Work, Guilty and DC

Posted on January 4, 2018January 4, 2018 by Denise Simon

If you think you can describe relationships and motivations globally and the connective tissue into Washington DC….you may need to think again.

This particular legal case decided yesterday has the makings of an HBO television documentary that includes past and present political power-brokers. We have Trump, Giuliani, Flynn, Obama, FBI, Justice, Iran, Turkey, lobbyists and even some violence.

What did the Obama administration know and why did they know it, then what?

Primer:

May 2017: MIAMI — President Donald Trump’s longtime Florida lobbyist, Brian Ballard, has expanded his practice globally and just signed a $1.5 million contract with the government of Turkey, which will be represented by the firm’s new big hire, former Florida Congressman Robert Wexler.

Ballard Partners’ Turkey contract, inked Friday, comes on the heels of two other international clients signed by the firm: A March 6 $900,000 contract with the Dominican Republic and an April 1 $240,000 contract with the Socialist Party of Albania, the ruling party in the Balkan nation. More here.

For a current list of clients for Ballard Partners, go here.

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Just the facts and the case of GOLD below, while several are still at large.

Enter the good guys, outside of government who perform remarkable and respected investigative work.

The Biggest Sanctions-Evasion Scheme in Recent History

And the swashbuckling gold trader at its center

SchanzerYesterday, Turkish banker Mehmet Hakan Atilla was found guilty in a Manhattan courtroom for a range of financial crimes. His dramatic trial revealed that tens of billions in dollars and gold moved from Turkey to Iran through a complex network of businesses, banks, and front companies.

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The trial was a long time coming. In late October of 2016, Justice Department officials paid a visit to the Foundation for Defense of Democracies, the Washington-based think tank where I serve as senior vice president. They wanted to talk about Reza Zarrab. A dual Iranian-Turkish national, Zarrab was the swashbuckling gold trader who had helped Iran evade sanctions with the help of Turkish banks in 2013 and 2014, yielding Iran an estimated $13 billion at the height of the efforts to thwart Tehran’s nuclear ambitions. A leaked report by prosecutors in Istanbul in March 2014 suggested that Zarrab spearheaded a second sanctions-busting scheme involving fake invoices for billions more in fictitious humanitarian shipments to Iran that were processed through Turkish banks.

At FDD, we’d spent considerable time digging into Zarrab’s activities. Our think tank already had an established track record of identifying and exposing Iran’s malign activities. We had also just launched a new program to explore Turkey’s recent drift into Islamist authoritarianism. The more we investigated, the more we realized that Zarrab’s schemes, which could have helped Iran pocket more than $100 billion, rank among the largest sanctions evasion episode in modern history.Despite the headlines generated by the gold trade and leaked report, the Turkish government insisted that everything was above board. The Obama administration seemed to echo this sentiment, saying that the gold trade had slipped through a legal loophole (a loophole the White House inexplicably left open for an additional six months, even after the problem was flagged). We soon learned Ankara’s political motivations: The gold trade helped boost Turkey’s flagging export numbers at a moment when those numbers might have hurt President Recep Tayyip Erdogan’s chances for reelection. Zarrab, who became fabulously wealthy by taking a percentage from every transaction (he later estimated his take at $150 million), even received a reward for his efforts from a Turkish trade association in 2015, with Erdogan applauding from the audience.

But it all came to an abrupt halt last March, when Zarrab inexplicably brought his family to America for a vacation at Disney World. With the 2015 nuclear deal in effect, he may have believed that the sanctions laws he violated before the deal were no longer in force. Some suggest that Zarrab was trying to flee Iranian justice, particularly as the regime came to grasp just how much he skimmed off the top. Either way, when he arrived in Florida, U.S. authorities arrested him for engaging in conspiracies to violate sanctions, commit bank fraud, and launder money.

It was about time. For three years, my colleagues and I had been briefing the Treasury Department, the State Department, and Congressional offices. We had tracked the export data (which, remarkably, Turkey did not hide), showing an astronomical spike in Turkish gold exports. We identified the companies and players, with the help of the 2014 prosecutor’s report. It was painstaking work, but it was all out there in open sources for a think tank like ours to document.Yet, it was an inconvenient moment to reveal unsavory truths about Iran, amid the push for the nuclear agreement. Nor did anyone, Democrat or Republican, want to touch the third rail of relations with Turkey, a NATO ally that had recently begun backing terrorist groups like Hamas (which still maintains a disturbing presence in Turkey) and a range of Sunni jihadi groups fighting the Assad regime in Syria (including al-Qaeda’s affiliate, according to senior U.S. government officials we interviewed). Stable allies in the Muslim world were scarce, and decision-makers seemed reluctant to take any chances with Ankara.

It may also have been difficult for officials to hear that the sanctions tools we have in place to prevent bad actors from moving money are just that—tools. Without intense vigilance and enforcement, there is ample opportunity for Iran and other sanctioned countries to find workarounds. But if we’re going to follow the money, we’d better be prepared to follow it to the most inconvenient places.

That’s why it was a pleasant surprise when the Justice Department came knocking on FDD’s door. It had never dawned on us that they might be interested in our work. But they were. They wanted to see what we already knew of the complex web of companies, networks, and schemes, that Zarrab employed to move money out of Turkey and into Iran. After all, even with the vast evidence they had collected, our research predated their investigation.In the weeks and months that followed, one visit begat another. Both I and Mark Dubowitz, FDD’s CEO, were asked by the assistant U.S. attorney to serve as an expert witness for the prosecution. We pored over invoices tracking the transactions that turned gold into Iranian cash. We analyzed spreadsheets detailing the dizzying trail of sales and purchases designed to obfuscate the illicit nature of the transactions. There were also photos, including one of Zarrab himself standing next to a six-foot high tower of plastic-wrapped bricks of $100 bills. The documents were privileged at the time, but will soon be made public now that the trial is over. The documents are damning, with textbook examples of money-laundering techniques like over-invoicing (charging significantly more for a given product to yield more margin) and circular invoicing (making multiple transactions involving the same funds or goods to hide a money trail or even benefit from arbitrage). The figures themselves were astounding: hundreds of millions of dollars in transactions in every stack of papers we viewed.

The case took a wild turn on March 28, when, Justice Department officials from the Southern District of New York arrested Atilla, the deputy CEO and general manager at Turkey’s state-owned Halkbank. They accused him of conspiring with Zarrab to launder hundreds of millions of dollars through the U.S. financial system on behalf of Iran. It was Halkbank that held one of the oil escrow accounts for Iran. The escrow accounts constituted a creative method of withholding petrodollars from Iran, as mandated by the Iran Threat Reduction and Syria Human Rights Act (ITRA) of 2012. In brazen defiance of U.S. sanctions, Halkbank released those funds to buy gold, which was then shipped off to Iran. Halkbank was also accused of helping to process Zarrab’s aforementioned fictitious invoices, the ones first exposed in the 2014 prosecutor’s report.

Uranium or gold

Halkbank was clearly in trouble. In September, it hired Ballard Partners, a U.S. lobbying firm that already represented the Turkish government, for a whopping $1.5 million. Separately, Zarrab hired former New York Mayor Rudy Giuliani and former Attorney General Michael Mukasey in an attempt to derail the proceedings. But the real drama came in late November when Zarrab pled out, making him a witness for the prosecution. Atilla would stand trial alone.

Related reading: Iran’s Turkish gold rush

That’s when the Turkish government got angry. They took their anger out on me and Mark Dubowitz, who testified on the first day of Atilla trial about the Iran sanctions architecture. The state media called us terrorists, alleging we were affiliated with Turkish cleric Fethullah Gulen’s network, the group Erdogan blamed for the attempted coup in July of last year. Ankara also issued an arrest warrant for my colleague Aykan Erdemir, a former Turkish parliamentarian. Turkish authorities froze his assets and even seized the apartment that his grandfather had bequeathed to the family. They said he “destroyed paperwork relating to state security” and “stole documents with the intention of using them abroad.” They also falsely identified him as being on the witness list.

But Ankara could not stop Zarrab from delivering seven days of sensational testimony. On day one, he appeared in court wearing a beige prison jumpsuit; for the remainder, he was allowed to wear a blazer. He was a natural in front of the jury, using diagrams to coolly explain how he orchestrated the scheme. He looked like a business school professor teaching a class on corruption.Here’s what Zarrab testified: The scheme began in 2010, when Iran began to feel the squeeze from U.S. sanctions for its nuclear drive. Zarrab said that around 2012 the Iranian government gave him explicit directions to conduct these illegal transactions. Turkish officials were also on the take, Zarrab said, with its economy minister allegedly taking $50 million in bribes to help facilitate the scheme. He said other Turkish officials were on the take, too—many of whom were in Erdogan’s inner circle. According to Zarrab, other Turkish banks may have been involved at the government’s behest. All this might explain why the Turkish government, even after the prosecutor’s report was leaked in 2014, killed all inquiry into the Zarrab scheme.

Testimony from David Cohen and Adam Szubin, two former Treasury Department undersecretaries would also reveal that Halkbank officials repeatedly reassured them their gold-trader clients, including Zarrab, were in compliance with U.S. sanctions against Iran. (Zarrab testified that he continued his operations up until his arrest in March 2016, which meant that Halkbank would have been lying to U.S. officials.)

In the end, the trial ran long. With the judge calling for the prosecution to wrap things up quickly, I managed to avoid taking the stand. Atilla testified in a last-ditch self-defense, and the jury began its deliberations on December 20.Yesterday, after spending 11 days away for Christmas and New Years, the jury returned to deliberate again, and after only a few hours delivered their verdict: guilty on five out of six counts. Atilla’s rap sheep now includes four conspiracy counts, including conspiracy to defraud the United States, plus one count of bank fraud. (He was acquitted for money laundering.)

All eyes are now on the United States government and whether it issues a fine against Halkbank, particularly now that it has proven in a court of law that the bank engaged in a massive, illegal financial scheme. French Bank BNP Paribas was fined $8.9 billion for far lesser transgressions in 2015, for its violations of sanctions against Sudan, Cuba, and Iran.

Fine or no fine, it’s hard to envision tranquil U.S.-Turkish relations going forward. Erdogan, who now rivals Russia’s Vladimir Putin in autocratic style, has already instructed his spokesman to decry the trial as a “plot” against Turkey, while slamming “the scandalous verdict of a scandalous case.”

Then there is the question of Iran. In all likelihood, Tehran probably gave little thought to the Atilla verdict, given its ongoing domestic turmoil. The people are calling for better economic conditions, and a foreign policy that doesn’t squander Iran’s wealth on adventurism outside the country’s borders. One can only guess that would include complex sanctions busting schemes to enable an illicit nuclear program.

And now that Zarrab has finally clarified a few things about the Iranian role in his scheme, one troubling question lingers: Why did the U.S. government continue to negotiate the nuclear deal with Iran in 2013 and 2014 while Treasury was warning Halkbank about enormous sanctions violations? We may never know. Then again, from the documents I viewed, I wouldn’t be surprised to see other sanctions busters come in the DOJ crosshairs—creating new and uncomfortable challenges for our existing alliances and diplomatic agreements. Perhaps other future indictments will tell us more.

About THAT Arab Bank in New York

Posted on January 2, 2018January 2, 2018 by Denise Simon

Yet another deadly and financial scandal both Barack Obama and John Kerry ignored for the sake of the consummation of the Iran nuclear deal.

Attorney General Jeff Sessions is launching a review of a law enforcement initiative called Project Cassandra after an investigative report was published this week claiming the Obama administration gave a free pass to Hezbollah’s drug-trafficking and money-laundering operations to help ensure the Iran nuclear deal would stay on track.

The Justice Department said in a statement to Fox News that Sessions on Friday directed a review of prior Drug Enforcement Administration investigations “to evaluate allegations that certain matters were not properly prosecuted and to ensure all matters are appropriately handled.”

“While I am hopeful that there were no barriers constructed by the last administration to allowing DEA agents to fully bring all appropriate cases under Project Cassandra, this is a significant issue for the protection of Americans,” Sessions said in a written statement. “We will review these matters and give full support to investigations of violent drug trafficking organizations.” More here.

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Glenn Simpson of Fusion GPS fame wrote about this case in 2005 while at the Wall Street Journal. And the LA Times further summarized the legal case against the Arab Bank and financing terror.

There is even a book about banking and terrorism.

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Back in 2015:

Three days before a first-of-its-kind damages trial was supposed to start, a Middle Eastern bank has reached a settlement with hundreds of American plaintiffs, including victims of terrorist attacks around Israel, who had filed a lawsuit against the bank accusing it of supporting terrorism.

A spokesman for the bank, Arab Bank, and a spokeswoman for one of the law firms representing the plaintiffs confirmed on Friday that an agreement had been reached but declined to offer additional details, including the amount of the settlement.

Last year, a jury in Federal District Court in Brooklyn found Arab Bank liable for financing terrorism by processing transactions for members of the militant Islamic group Hamas. More here.

*** Image result for arab bank new york Arab bank, New York

BEIRUT: Jordan’s largest lender, the Arab Bank, announced this week that a New York federal court dismissed more than 90 percent of the claims in a long-running lawsuit accusing it of providing banking services to charities and individuals allegedly affiliated with Palestinian militants. The ruling is the most significant victory yet for the Arab Bank yet in its nine-year legal battle with 6,596 relatives of victims killed or injured in two dozen Palestinian attacks in Israel during the Second Intifada. More here.

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LINDE v. ARAB BANK, PLC

In July 2004, Osen LLC sued Arab Bank, Plc on behalf of American terror victims in the U.S. District Court for the Eastern District of New York. The lawsuit, captioned Linde v. Arab Bank, Plc and brought under the Anti-Terrorism Act (ATA), was the first civil lawsuit brought against Arab Bank. The Plaintiffs sought to hold Arab Bank liable for deaths and severe injuries resulting from acts of international terrorism that Palestinian terrorist groups perpetrated between 2000 and 2004, during the Second Intifada. After 10 years of litigation that included multiple appeals, American victims of terrorism were finally able to present their case to a Brooklyn jury in August and September 2014. The first trial centered around 24 terrorist attacks that the Plaintiffs alleged were perpetrated by Hamas, a Foreign Terrorist Organization that the United States first designated a terrorist entity in 1995. On September 22, 2014, an 11-person jury found Arab Bank liable for knowingly providing financial services for Hamas. This finding represented the first, and still only, time a financial institution has been held civilly liable for aiding terrorism.

The Liability Trial (August-September 2014)

During the course of the trial, which centered around 24 Hamas terrorist attacks between March 2001 and September 2004, the Plaintiffs proved that Arab Bank knowingly provided material support to Hamas by illegally maintaining accounts for: Hamas (via an account held in the name of senior Hamas leader and spokesman Osama Hamdan that accepted multiple checks explicitly made out to beneficiary “Hamas“); Hamas’s founder and supreme leader, Sheikh Ahmed Yassin (Yassin was first designated a Specially Designated Terrorist in 1995); and dozens of other Hamas leaders and senior operatives, including Salah Shehadeh – founder and former head of the Izz al-Din al-Qassam Brigades in Gaza, and Ismail Haniyeh, former Prime Minister of the Palestinian Authority and current Hamas leader in Gaza. The Plaintiffs also proved that Arab Bank knowingly provided material support to terrorist groups such as Hamas and Hezbollah that facilitated millions of dollars in direct transfers to the families of suicide bombers and other terrorist operatives through the Saudi Committee for the Support of the Intifada al Quds and the Al-Shahid Foundation. Lastly, the Plaintiffs proved that Arab Bank knowingly provided material support to Hamas by maintaining accounts for eleven Hamas-controlled organizations in the Palestinian Territories.

One of Arab Bank’s chief contentions, voiced by defense expert Beverley Milton-Edwards, was that the identities of Hamas leaders were not well known between 2000-2004. The jury, however, was shown a video of the funeral of the infamous Hamas bomb-maker, Muhanad al-Taher, in the town square of Nablus. Hamed Beitawi, vice-Chairman of the Nablus Zakat Committee and Chairman of the Islamic Solidarity Al-Tadhamun Charitable Society – Nablus (two of the eleven relevant Hamas-controlled organizations, both of which maintained accounts at Arab Bank) spoke at this very public event. Dr. Milton-Edwards was also impeached by video showing Salah Shehadeh – founder and former head of the Izz al-Din al-Qassam Brigades in Gaza – giving a speech to a massive audience, thus undercutting the Bank’s claim that Hamas leaders “lived in the shadows.”

Post-Trial Proceedings

After the jury rendered its unanimous verdict, Arab Bank filed 3 motions, arguing: (1) notwithstanding the jury’s verdict, Arab Bank was entitled to victory on the merits and dismissal of the case; (2) if the Court would not grant that relief, Arab Bank was entitled to a new trial because of purported mistakes the Court made in managing the trial; and (3) in any event, the Bank was entitled to immediate review of the verdict by the U.S. Court of Appeals for the Second Circuit.

The Court denied the Bank’s motions for a new trial and for Second Circuit review of the verdict. In its decision, the Court noted that the Bank’s liability was established “on volumes of damning circumstantial evidence that defendant knew its customers were terrorists.”

The Court further noted the testimony of the Bank’s own former head compliance officer in London who was presented with the Saudi Committee wire transfer payable to “the family of martyr Ibrahim Karim Beni Awda” and responded: “[w]e would never in a million years have dealt with a payment order such as this.”

The Court’s decision also took note of the testimony of Arab Bank’s primary expert witness, Dr. Milton-Edwards, who testified that the organizations in the Palestinian Territories at issue in the case were neither controlled by Hamas nor perceived as Hamas affiliates during the relevant period based in part of her review of “paraphernalia” she observed during her visits to these organizations. The Court observed that her testimony “backfired in spectacular fashion” when “it came out on cross-examination that she could not read Arabic.”

Furthermore, the Court noted Dr. Milton-Edwards’ impeachment by her own book: She had testified that the Islamic Society of Gaza was neither affiliated with Hamas nor perceived as such by the Palestinian public. Her book told a different story, however:

[t]he work of the Islamic Society and the rest of Hamas’s network in the decades up to, during and after the second intifada, when families needed it most, represented not so much a donation as an investment by Hamas, one that reached a lucrative political dividend in the 2006 election.

Ultimately, the Court concluded, “[t]he effect of cross-examination on Dr. Milton-Edwards’ testimony, and its potential spillover effect on the credibility of defendant’s entire case, is … hard to overstate.”

Arab Bank’s Appeal

Following the Court’s denial of the Bank’s motions for a new trial the parties prepared for the first damages trial, which the parties agreed to postpone once they reached a framework for settlement of all of the Plaintiffs’ Anti-Terrorism Act-related claims.

As part of the settlement, the Bank reserved the right to take a one-time appeal of the liability verdict, the outcome of which would determine the settlement’s precise contours. The briefing is complete and the Second Circuit heard extensive oral argument on May 16, 2017.

Remember, Obama Removed Iran/Hezbollah from Terror List

Posted on January 1, 2018January 1, 2018 by Denise Simon

In February of 2015, yup the Obama administration instructed the intelligence community to remove Iran and it’s proxies such as Hezbollah from the terror list mostly due to the Iran nuclear deal and the assistance Iran was providing the Baghdad government in fighting Islamic State…..ahem….sure thing.

“Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF) and Lebanese Hezbollah are instruments of Iran’s foreign policy and its ability to project power in Iraq, Syria, and beyond,” that assessment, also submitted to the Senate of February 26, said in its section on terrorism. “Hezbollah continues to support the Syrian regime, pro-regime militants and Iraqi Shia militants in Syria. Hezbollah trainers and advisors in Iraq assist Iranian and Iraqi Shia militias fighting Sunni extremists there. Select Iraqi Shia militant groups also warned of their willingness to fight US forces returning to Iraq.” More here.

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But Hezbollah’s more recent moves in Latin America are very much a matter of interest for investigators, too. In October, a joint FBI-NYPD investigation led to the arrest of two individuals who were allegedly acting on behalf of Hezbollah’s terrorist wing, the Islamic Jihad Organization (IJO). At the direction of their Hezbollah handlers, one person allegedly “conducted missions in Panama to locate the U.S. and Israeli Embassies and to assess the vulnerabilities of the Panama Canal and ships in the Canal,” according to a Justice Department press release. The other allegedly “conducted surveillance of potential targets in America, including military and law enforcement facilities in New York City.” In the wake of these arrests, the director of the National Counterterrorism Center warned: “It’s our assessment that Hezbollah is determined to give itself a potential homeland option as a critical component of its terrorism playbook, and that is something that those of us in the counterterrorism community take very, very seriously.” These cases, one official added, are “likely the tip of the iceberg.”

The administration’s counter-Hezbollah campaign is an interagency effort that includes leveraging diplomatic, intelligence, financial and law enforcement tools to expose and disrupt the logistics, fundraising and operational activities of Iran, the Qods Force and the long list of Iranian proxies from Lebanese Hezbollah to other Shia militias in Iraq and elsewhere. But in the words of Ambassador Nathan Sale, the State Department coordinator for counterterrorism, “Countering Hezbollah is a top priority for the Trump administration.” Since it took office, the Trump administration has taken a series of actions against Hezbollah in particular — including indictments, extraditions, public statements and rewards for information on wanted Hezbollah terrorist leaders — and officials are signaling that more actions are expected, especially in Latin America. Congress has passed a series of bills aimed at Hezbollah as well. The goal, according to an administration official quoted by Politico, is to “expose them for their behavior.” The thinking goes: Hezbollah cannot claim to be a legitimate actor even as it engages in a laundry list of illicit activities that undermine stability at home in Lebanon, across the Middle East region and around the world.

To support this policy, the administration has issued a broad RFI — a request for information — requiring departments and agencies to scour their files and collect new information that could be used to identify targets and help direct and inform the implementation of forthcoming actions. Though it is unclear if it is a result of that RFI, it appears new information is coming in, as evidenced most recently by a little-noticed FBI “Seeking Information” bulletin issued by the Bureau’s Miami Field Office. More here.

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All of this has turned quite political on The Hill due in part to recent investigative report published by Politico on how Obama gave Iran, a state sponsor of terror networks worldwide a major pass. In part from Congressional testimony in June of 2017:

Hezbollah has experienced a series of financial setbacks, leading U.S.

officials to describe the group being in the “worst financial shape in decades.”

Indeed, Hezbollah has in recent months resorted to launching an online fundraising crowdsourcing campaign entitled “Equip a Mujahid Campaign” which calls for donations, large or small, payable all at once or in installments, to equip Hezbollah fighters.

Hezbollah has also promoted a fundraising campaign on billboards and posters promoting a program through which supporters whereby supporters can avoid recruitment into Hezbollah’s militia forces for a payment of about $1,000.

These are desperate measures for a group suffering tough financial times.

And yet, Hezbollah continues to collect sufficient funds to deploy a significant militia

at home and next door in Syria, to send smaller groups of operatives to Iraq and Yemen,

and to operate an international terrorist network with deadly effect.

To effectively counter Hezbollah’s financing, the U.S. must lead an international effort to target the group’s illicit financial conduct both at home in Lebanon and around the world. More here.

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Meanwhile to fully comprehend the full construction of Iranian terror networks globally and the historical facts, go here.

In day 5 of the Iranian people protesting the Iran government, at least a dozen have been killed.

Initially, state TV said that 10 people had been killed overnight, but that figure was later raised to 13 by a regional governor:

Six died after shots were fired in the western town of Tuyserkan, 300km (185 miles) south-west of Tehran

Later, Hamadan province’s governor told the ISNA agency that another three people had also been killed in the city

Two people died in the south-western town of Izeh, an official said

Two died in clashes in Dorud in Lorestan province

This has the makings of the conflict seen in Syria as the genesis is the same. Where will this put militant Islamist groups in the mix is an open question. Islamic State did launch a terror attack in June of 2017.

There are other moving parts to the building civil conflicts in Iran and they include Israel, Saudi Arabia, North Korea, Syria, Lebanon, Iraq and the United States.

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In part from Reuters: Hundreds have been arrested, according to officials and social media. Online video showed police in the capital Tehran firing water cannon to disperse demonstrators, in footage said to have been filmed on Sunday.

Protests against economic hardships and alleged corruption erupted in Iran’s second city of Mashhad on Thursday and escalated across the country into calls for the religious establishment to step down.

Some of the anger was directed at Ayatollah Ali Khamenei, breaking a taboo surrounding the man who has been supreme leader of Iran since 1989.

Video posted on social media showed crowds of people walking through the streets, some chanting “Death to the dictator!” Reuters was not immediately able to verify the footage. The Fars news agency reported “scattered groups” of protesters in Tehran on Monday and said a ringleader had been arrested.

“The government will show no tolerance for those who damage public property, violate public order and create unrest in society,” Rouhani said in his address on Sunday.

Unsigned statements on social media urged Iranians to continue to demonstrate in 50 towns and cities.

The government said it was temporarily restricting access to the Telegram messaging app and Instagram. There were reports that internet mobile access was blocked in some areas.

The Post Obama Iran Report

Posted on December 18, 2017December 18, 2017 by Denise Simon

Former Mossad Chief explains, it is all about the Iran threat. Clearly, the Obama administration including is National Security Council and both Secretaries of State focused more on Israel and accusatory ‘occupier’ status than on Iran.

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Behzad Mesri, the Iranian national the US has accused of hacking HBO this year, is part of an elite Iranian cyber-espionage unit known in infosec circles as Charming Kitten, according to a report released yesterday by Israeli firm ClearSky Cybersecurity.

Known as an APT (Advanced Persistent Threat), this group has been active since 2013 and is believed to be operating under the protection of the local Iranian government.

The group’s activities have been first exposed in March 2014, when US cyber-security firm FireEye published a report entitled “Operation Saffron Rose.”

Charming Kitten —also tracked under various codenames such as Newscaster, NewsBeef, Flying Kitten, and the Ajax Security Team— was one of the most active Iran-based cyber-espionage units at the time, but once the FireEye report went public, the group dismantled its infrastructure and went dormant.

Subsequent research published by Iran Threats and ClearSky show that parts of the old Charming Kitten infrastructure, such as malware and credential theft resources, have been reused by another Iranian cyber-espionage unit named Rocket Kittens, and possibly more.

Various experts have pointed out that most of these groups are most likely operating under the protection and guidance of Iranian military, hence the reason why some resources are used not by one or two, but multiple APTs.

According to the official indictment, US officials said Mesri worked for the Iranian military, but that he also lived a separate life as a hacker. Evidence shows that Mesri defaced hundreds of websites and most likely carried out the HBO hack outside of his role in the Charming Kittens operations, most of which have targeted Iranian dissidents.

Mesri had connections to other Charming Kitten members

The 59-page ClearSky report released yesterday shows a web of connections between Mesri and other members of the Charming Kitten espionage unit, including connections to a hacktivist group known as the Turk Black Hat Security hacking group, where Mesri operated under the pseudonym of “Skote Vahshat,” together with other persons linked to Iranian APTs.

Besides Charming Kitten and the subsequent Rocket Kitten incarnation, Iran is home to other APT groups such as OilRig [1, 2], CopyKittens, and Magic Hound (Cobalt Gypsy, Timberworm), all very active.

In fact, Iranian actors are some of the most active groups around, albeit far from the most sophisticated. Their usual targets are businesses, human rights groups, individuals, and nearby governments of interest or at odds with the Iranian government — such as Saudi Arabian companies and government agencies, or Israeli military and government targets.

According to multiple reports, the Charming Kittens group of which Mesri is suspected of being a member, operated using mundane spear-phishing and watering hole attacks, and targeted individuals using made-up organizations and people, fake news sites, or by impersonating real companies.

The group was not sophisticated like US, Chinese, or Russian counterparts, but persisted with attacks until they got access to their targets’ email inbox and social media accounts, most likely to gather information on a person’s past or upcoming plans. More details here.

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Is Iran a cyber threat? Yes and gaining hacking abilities quickly.

Tehran poses an increasing cyber threat to the U.S., in light of the Trump administration’s allegations that Iran is violating United Nations Security Council resolutions tied to the nuclear agreement. Iran-sponsored hackers—dismissively referred to as “kittens” for their original lack of sophistication—are bolstering their cyber warfare capabilities as part of their rivalry with Saudi Arabia. But should President Donald Trump take further steps to scrap the nuclear deal, it could mean an uptick in Iranian state-sponsored cyber intrusions into American and allied systems, with the goals of espionage, subversion, sabotage and possibly coercion.

Since 2011, Iran has worked to establish itself as a prominent aggressor in cyberspace, alongside China, Russia and North Korea. Evolving from mere website defacement and crude censorship domestically in the early 2000s, Iran has become a player in sustained cyber espionage campaigns, disruptive denial of service (DDoS) attacks and the probing of networks for critical infrastructure facilities.

Iran wasn’t pursuing cyber capabilities with much urgency, experts say, until it was revealed in 2010 that a joint Israeli-U.S. Stuxnet worm sabotaged nuclear centrifuges at Iran’s facility in Natanz. As the first-known instance of virtual intrusions resulting in physical effects, the operation demonstrated the potential effectiveness of such an attack and has informed much of Iranian cyber operations since.

Iran often has conducted disruptive cyber operations loosely in response to actions taken by others. It sees offensive cyber operations as an asymmetric but proportional tool for retaliation. For example, following the Stuxnet attack and the imposition of new sanctions on Iran’s oil and financial sectors in 2011, Tehran was suspected of retaliating in 2012 by releasing the Shamoon disk-wiping malware into the networks of Saudi oil giant Saudi Aramco and Qatar’s natural gas authority, RasGas. It also launched volleys of DDoS attacks against at least 46 major U.S. financial systems.

Iran commonly conducts its state-sponsored cyber operations behind a thin veil of hacktivism. From 2011 to 2013, a group calling itself the Qassam Cyber Fighters launched DDoS attacks that flooded the servers of U.S. banks with artificial traffic until they became inaccessible. In March 2016, the Justice Department unsealed indictments of seven individuals—employees of the Iran-based computer companies ITSecTeam and Mersad Company—for conducting the DDoS attacks — and intrusions into a small dam in upstate New York—on behalf of the Islamic Revolutionary Guard Corps (IRGC), the arm of Iran’s military formed in the aftermath of the 1979 Iranian revolution.

While much of Iran’s cyber operations have been attempts at asymmetric disruption against its Gulf rivals, Israel and the United States, it has recalculated since the 2015 negotiation of the Joint Comprehensive Plan of Action (JCPOA), the Iran nuclear deal.

Under scrutiny by the international community, Iran has largely reined in disruptive attacks against the U.S., with some operations still deployed against Saudi Arabia. In November 2016, a variant of the disk-wiping malware Shamoon was deployed against Saudi aviation and transportation authorities.

Rather than relying on disruptive attacks against the West, Iran has pursued cyber-enabled information warfare against its regional competitors, namely Saudi Arabia. By utilizing cyber proxies to access and weaponize privileged information, Iran has subtly sought to undermine Saudi Arabia’s political standing in the region and in the eyes of international allies. This kind of grey-zone offensive—an act short of war—is a page right out of the Russian intelligence playbook of active measures in Europe and the U.S.

In April 2015, the pro-Saudi newspaper Al Hayat was hacked by a group calling itself the Yemen Cyber Army, which experts say has loose ties to Iran. The attack replaced the media outlet’s front page with threatening messages aimed at dissuading the Saudis from getting involved in the civil unrest bubbling across their southern border. The hack was followed quickly by stories on Iran’s state-run FARS news agency and Russia’s RT network, citing the Yemen Cyber Army for breaching the Saudi foreign ministry and its threats to release personal information on Saudi officials and expose diplomatic correspondence that allegedly suggested Saudi support of Islamist groups in the region. One month later, WikiLeaks published material likely taken from the trove of stolen correspondence.

In another example, an Iran-linked Hezbollah hacktivist group known as the Islamic Cyber Resistance leaked sensitive material related to the Saudi army, the Saudi Binladin Group and the Israeli Defense Forces, following the December 2013 assassination of Hezbollah leader Hassan al-Laqis, according to Matthew McInniss, an AEI scholar now working on Iran in the Trump State Department. Ties also have been detected between Iran and the Syrian Electronic Army, the hacking wing of the regime of Bashar al-Assad, according to Cipher Brief expert and former CIA and NSA chief Michael Hayden.

The link between Iranian government support and the cyber proxy actors is difficult to prove. But it would follow the pattern of Iranian military assistance given to other types of proxy forces in Lebanon, Syria and Yemen.

The governmental structure in Iran that oversees cyber-related activities is the Supreme Council of Cyberspace, established by Ayatollah Ali Khamenei in March 2012. It consists of representatives from various Iranian intelligence and security services. However, the direct command-and-control structure for engaging in cyber operations remains a mystery, particularly when it comes to cyber proxies. While it could be the responsibility of Iran’s Quds Force, the external wing of the IRGC, the lack of a clear command-and-control system could be intentional. Similar to Iran’s “mosaic defense” military structure, cyber operations appear more decentralized and fluid than other countries with advanced cyber capabilities—Russia and China, for example—complicating the tracking and attribution of attacks.

The Iranian nuclear deal may have had some cyber-deterrent value, in that it reined in Iranian disruptive attacks against the West, but this could be short-lived. Rhetoric from the Trump administration is stoking the fire, including recent statements by U.S. Ambassador to the United Nations Nikki Haley that Iran is violating the nuclear agreement.

Iran, as a result, is likely to engage in broad-spectrum cyber espionage to alleviate that uncertainty. For example, Operation Cleaver in 2012-14 hit U.S. military targets, as well as systems in critical industries such as energy and utilities, oil and gas, chemicals, airlines and transportation hubs, global telecommunications, healthcare, aerospace, education and the defense industrial base. Earlier this month, reports surfaced of a new Iranian state-sponsored actor—referred to as APT 34—conducting reconnaissance of critical infrastructure in the Middle East.

While the probing of such essential systems is alarming, it is expected as a contingency plan, should relations with adversaries escalate. The New York Times reported that the U.S. had similar plans – known as Operation Nitro Zeus – to disrupt Iranian critical services should the nuclear negotiations have gone sideways during the Obama administration. It is likely the Trump administration is devising similar contingency plans. Learn more about the contributors here.