Alabama Man Indicted for Bypassing US Sanctions on Iran to Sell Goods

The Iranian flag waves in front of the International Atomic Energy Agency headquarters in Vienna on May 23, 2021. Leonhard Foeger/Reuters

An indictment was unsealed on Nov. 29 charging an Iranian man living in Alabama with federal offenses concerning the export of U.S.-origin goods to Iran, bypassing prevailing sanctions.

According to the 15-count indictment charges announced by the Justice Department, Ray Hunt—who also uses the names Abdolrahman Hantoosh, Rahman Hantoosh, and Rahman Natoosh—of Madison County, Alabama, allegedly smuggled goods from the United States through Turkey and the United Arab Emirates into Iran. He is accused of submitting false or misleading export information and defrauding the United States.

Hunt, 69, allegedly conspired to export American products used in the oil and gas industry, such as control valves and oil tubing, through his Alabama-based company, Vega Tools LLC, to customers in Iran since at least 2017. The products were routed through other countries to evade U.S. sanctions.

If convicted of trade violations, Hunt faces a maximum penalty of up to 20 years in prison and up to a $1 million fine, the Justice Department said. Additionally, he faces up to five years for the conspiracy charge, 10 years for the smuggling offense, and up to five years for the false information offense.

He made his initial court appearance on Tuesday.

Cryptocurrency Exchange Violates Iran Sanctions

Cryptocurrency exchange Kraken has agreed to pay over $362,000 to settle its potential civil liability for apparent violations of U.S. sanctions against Iran, according to a recent release (pdf) by the Treasury Department.

An additional $100,000 will be invested by the company as part of its settlement with the Office of Foreign Assets Control (OFAC). Kraken failed to implement appropriate geolocation tools, including an automated internet protocol (IP) address blocking system which allowed for the company to provide virtual currency transaction services to users in Iran.

Kraken’s violations were nonegregious and voluntarily self-disclosed, said OFAC. Authorities have been finding it difficult to monitor cryptocurrency transactions and regulate while adhering to trade policies.

Founded in 2011, Kraken allows users to buy, sell, or hold cryptocurrencies, as well as trade fiat currency for cryptocurrencies. Between Oct. 14, 2015, and June 29, 2019, Kraken processed 826 transactions totaling approximately $1.7 million on behalf of individuals who appeared to have been located in Iran at the time of the transactions.

After the issue was identified, Kraken implemented blockchain analytics tools and automated blocking for related IP addresses.

Sanctions Against Iran

Sanctions have been imposed on Iran since the 1979 armed seizure of the U.S. Embassy in Tehran, with continued restrictions enforced over the years for ongoing human rights violations and promotion of terrorism and instability in the Middle East region.

On Nov. 17, OFAC sanctioned 13 companies based in the UAE and Hong Kong facilitating the sale of hundreds of millions of dollars’ worth of Iranian petrochemicals and petroleum products to buyers in East Asia.

“Today’s action further demonstrates the complex sanctions evasion methods Iran employs to illicitly sell petroleum and petrochemical products,” Brian E. Nelson, undersecretary of the Treasury for terrorism and financial intelligence, said in a news release. “The United States will continue to implement sanctions against those actors facilitating these sales.”