Lethal Technology Making Way From U.S. to Iran Via Front Companies

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By Joby Warrick
Washington Post Staff Writer
Sunday, January 11, 2009

The Iranian businessman was looking for high-quality American electronics, but he had to act stealthily: The special parts he coveted were denied to Iranians, especially those seeking to make roadside bombs to kill U.S. troops in Iraq.

With a few e-mails, the problem was solved. A friendly Malaysian importer would buy the parts from a company in Linden, N.J., and forward them to Iran. All that was left was coming up with a fake name for the invoice. Perhaps a Malaysian engineering school? "Of course, you can use any other company as end-user that you think is better than this," the Iranian businessman, Ahmad Rahzad, wrote in an e-mail dated March 8, 2007.

The ruse succeeded in delivering nine sensors called inclinometers to Iran, the first of several such shipments that year and the latest example of what U.S. officials and weapons experts describe as Iran's skillful flouting of export laws intended to stop lethal technology from reaching the Islamic republic.

Despite multiple attempts by the Bush administration to halt illegal imports -- including sanctions against several Dubai-based Iranian front companies in 2006 -- the technology pipeline to Tehran is flowing at an even faster pace. In some cases, Iran simply opened new front companies and shifted its operations from Dubai to farther east in Asia, the officials said.

Iran in the past two years has acquired numerous banned items -- including circuit boards, software and Global Positioning System devices -- that are used to make sophisticated versions of the improvised explosive devices, or IEDs, that continue to kill U.S. troops in Iraq, according to documents released by the Justice Department and a new study by a Washington research institute. The deadly trade was briefly disrupted after the moves against Dubai companies in 2006, but it quickly resumed with a few changes in shipping routes and company names, the officials said.

"Without doubt, it is still going on," said one former U.S. intelligence official who investigated Iran's networks.

Bomb circuitry is only a small part of the global clandestine trade that continues to flourish, despite U.S. efforts to end it. A federal investigation in New York into whether banks helped customers skirt U.S. rules forbidding business with Iran and other countries turned up evidence of Iranian interests trying to buy tungsten and other materials used in the guidance systems of long-range missiles. As part of the investigation, a British bank agreed to forfeit $350 million.

While illegal trafficking in weapons technology has occurred for decades -- most notably in the case of the nuclear smuggling ring operated by Pakistani scientist Abdul Qadeer Khan -- the new documents suggest that recent trading is nearly all Internet-based and increasingly sophisticated.

Many of the schemes unknowingly involve U.S. companies that typically have no clue where their products are actually going, the records show.

"The schemes are so elaborate, even the most scrupulous companies can be deceived," said David Albright, president of the Institute for Science and International Security (ISIS) and co-author of a forthcoming study of black markets for weapons components.

Albright said the deceptions can be even more elaborate when the target is nuclear technology. "That's where the stakes are the highest," he said. "If Iran is successful, it ends up not with an IED but with a nuclear weapon."

Rare details about the illicit markets emerge in court records from the Justice Department's investigation of Iran's Dubai network, as well as in the ISIS study, which tracks four years of secret trading by Iranian and Pakistani front groups. The study includes copies of invoices and the contents of e-mails from companies looking to buy Western technology.


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