Turkish firm implicated in US federal indictment for illegal Iran trade, fraud

 

A Turkish logistics, supply and shipping company has been implicated in a US federal indictment filed in November 2018 in which a US-based Pentagon contractor was charged with illegal Iran trade and fraud in billions of dollars of contracts.

Nordic Monitor has identified Turkish company T.R Ader İthalat, İhracat, Taşımacılık, Gıda Sanayi ve Ticaret Limited Şirketi, which played a key role in a scheme to defraud the United States through contracts in Afghanistan, engaged in illegal commerce in Iran and laundered money internationally. The federal indictment did not list the Turkish company by name but rather referred to it as “Transhipper # 2,” a transportation company headquartered in Mersin, Turkey.

T.R. Ader, branding itself as Trader Camp Supply or TCS in its company brochures, is based in Turkey’s Mediterranean province of Mersin. In a company promotion, T.R. Ader actually boasted how it landed several contracts with Anham FZCO (formerly known as Nour USA), a defense contractor based in the United Arab Emirates (UAE), which maintained offices in Dubai, Jordan and the US.

Federal prosecutors indicted Anham’s former chief executive officer Abul Huda Farouki, his brother Mazen Farouki, the president and founder of Unitrans International Incorporated, an international logistics company with close ties to Anham, and Salah Maarouf, all US nationals and residents of Virginia, with two counts of major fraud, one count of conspiracy to violate the restrictions on doing business with Iran, four counts of substantive violations of those restrictions and one count of conspiracy to commit international money laundering.

T.R. Ader states that it has subsidiaries in the US called American International Services (AIS), based in Virginia, and in the UAE under the name of Lima Trading FZE. The US indictment also lists AIS as a subsidiary of the holding company that owns Unitrans. AIS purchased goods and services for Anham, according to the indictment.

T.R. Ader brochure shows the company headquarters in Turkey with subsidiaries in other countries.

T.R. Ader has been a long-time partner of Anham, and the two worked together in a 2011 project called TAJI National Depot – 500 Person Military Camp, valued at $1.7 million. The project included supply, delivery and installation of a military camp with fully furnished prefabricated units in Taji, Iraq. Another project T.R. Ader worked on with Anham was a $4.2 million deal for the delivery and installation of warehouse racking systems in the Afghan cities of Kabul and Kandahar in 2011. It also had a contract with Nour USA (before it was renamed Anham) for a million-dollar deal to supply two Caterpillars for Anham’s Kuwait facility.

Project awarded to T.R. Ader by a US military contractor.

The investigation by Nordic Monitor showed that T.R. Ader was established in 2005 by two Turkish nationals identified as Melike Çekmez and Zafer Çekmez. Two years later, most of the shares were transferred to Semih Sürmeli and Muharrem Serkan Küçükusta. In 2008, Melike sold all her remaining shares as well. At a board meeting held on October 26, 2018 Küçükusta transferred his shares to a Turkish woman named Nihal Kahil, giving her ownership of half the shares in T.R. Ader with the other half owned by Sürmeli.

Trade registry shows the owners of T.R. Ader located in Turkey’s Mersin province.

According to the indictment, on June 22, 2012 the US Department of Defense awarded Anham an $8 billion contract, known as the “SPV-A contract,” to provide food and other subsistence items to US troops in Afghanistan. As part of the bidding process, the defendants allegedly caused Anham to represent that it would build two warehouses in Afghanistan, which Anham would use to provide supplies to US forces. The indictment alleges that the defendants schemed to defraud the Department of Defense in connection with the SPV-A contract by submitting bids that contained knowingly false estimates of the completion dates for the warehouses and by providing the government with misleading photographs intended to convey that Anham’s progress on the warehouses was further along than it actually was.

Specifically, the indictment alleges that in February 2012, the defendants and others caused Anham employees to transport construction equipment and materials to the proposed site of one of the warehouse complexes to create the false appearance of an active construction site. Members of the conspiracy then photographed the site, provided the photographs to the Department of Defense and then largely deconstructed the staged construction site.

The SPV-A contract also required bidders to certify that they were abiding by the Iran Sanctions Act, which prohibits US citizens and companies from engaging in commercial activity in Iran. According to the indictment, the defendants conspired to increase Anham’s profits in connection with the SPV-A contract by shipping warehouse building materials to Afghanistan via Iran, instead of using more costly, but legal, routes. Also according to the indictment, after learning that The Wall Street Journal was planning to run a story detailing Anham’s practice of shipping materials through Iran, Abul Huda Farouki sent an email to a senior Department of Defense official which falsely claimed that senior management at Anham had been unaware that the transshipments through Anham had taken place.

In addition to the SPV-A contract, the indictment alleges that the defendants schemed to defraud the Department of Defense with respect to the National Afghan Trucking (NAT) contract, a $984 million contract that required Anham to supply trucking services to the US military in Afghanistan. As with the SPV-A contract, the NAT contract required bidders to certify compliance with laws concerning sanctions imposed on Iran. According to the indictment, rather than ship trucks to Afghanistan using legal but relatively expensive routes, the defendants conspired to cut costs by transporting vehicles through Iran. The indictment alleges that the defendants’ conduct violated laws prohibiting fraud, commercial activity with Iran and international money laundering.

The indictment listed several pieces of evidence that showed how the suspects planned to violate US laws. For example, in an email chain that occurred on or about December 7-8, 2011, an employee of Anham advised an employee of Unitrans that Anham’s efforts to ship steel to Afghanistan for the purpose of building a warehouse were frustrated by the fact that Pakistan had closed its border crossing and that Unitrans and Anham needed to find alternatives. The Unitrans employee responded: “Mazen suggested to Huda that we transport through Iran. He is working on this.” The Unitrans employee then forwarded the email exchange to Mazen Farouki, who responded, “noted.”

In another email chain on December 12, 2011 discussing Anham’s plan to ship materials through Iran, an employee of Anham wrote: “can you please take me off the emails. I am neither interested nor concerned with shipments going through Iran.” An    employee of Unitrans then replied: “How many times do we need to request to remove the mentioning of a specific country in all emails. STOP that mentioning please IMMEDIATELY.”

In an email dated on or about March 5, 2012, an Anham employee advised Mazen Farouki and others that shipping material through Iran would jeopardize Unitrans’ relationship with its bank: “The other alternative of shipping route as I was told is thru Iran and this solution will put Anham in trouble with the bank and accordingly they will not accept the shipping documents they will reject to pay for the [letter of credit].”

On or about May 30, 2012, Anham wired $376,714.19 from its account at the Bank of Georgetown in the District of Columbia to Unitrans. The payment was reimbursement to Unitrans for: (1) payments by Unitrans to Transshipper #2 for invoices related to containers shipped through Iran; and (2) to another company for land transportation of containers, which had been moved across Iran, from the Afghan border to Kabul or Bagram. The wire transfer was sent to the same account from which Unitrans had paid Transshippers #1 and #2 for its services in transporting goods across Iran.

Tracks International, a corporation founded in Jordan in 2009, was 80 percent owned by Anham and 20 percent owned by Unitrans. According to the indictment, on or about April 17, 2012 the CEO of Tracks informed Transshipper #2 that Tracks had received notice from Anham to proceed with the shipment of the trucks and that a ship would soon be arriving in Bandar Abbas, Iran, with the trucks and requiring Transshipper #2 to be ready to proceed. The message was copied to defendants Salah Maarouf and Mazen Farouki.

Between May 2012 and August 2012, Anham caused Transshipper #2 to ship the trucks and trailers for the US contract and approximately four containers across Iran.

In September 2013, when The Wall Street Journal reported on Anham’s shipments of warehouse components and trucks across Iran, Abuk Huda Farouki informed US authorities that senior management at Anham had no knowledge of the transshipments at the time they took place, when in fact senior management had full knowledge and authorization for such shipments.

The defendants made their initial appearance on Nov. 29, 2018 before Judge G. Michael Harvey. All were arraigned and pleaded not guilty. Anham denied all charges and stated that it was continuing to cooperate with the Justice Department. “Nevertheless, the company continues to believe that the purported violations are without legal merit,” the company said in a statement on its website.

Anham denied all charges and stetted that it continues to cooperate with the Justice Department.

The charges were announced on Nov. 29, 2018 by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Agent in Charge Patrick J. Lechleitner of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Washington, D.C., and Special Inspector General for Afghanistan Reconstruction (SIGAR) John F. Sopko.

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