Iran stock exchange suspends largest steel-maker after fraud claims

TEHRAN: Tehran’s stock exchange has suspended Iran’s largest steel-maker from trading following a parliamentary report alleging corruption to the tune of $3 billion, local media reported.

Trading of the Mobarakeh Steel Company’s stocks has been suspended “due to uncertainties about the transparency of information”, said the Tehran bourse’s chief executive Mahmoud Goudarzi, quoted by the Fars news agency.

Trading in the company will not resume “until the necessary information is clearly obtained”, he said, according to the news report late Saturday.

Located in central Isfahan province, Mobarakeh plays a major role in Iran’s economy and is the owner of local football team Sepahan.

The firm and several of its subsidiaries are subject to US Treasury Department sanctions.

Fars said the decision came days after the release of a 295-page parliamentary report alleging widespread corruption among the firm’s senior management between 2018 and 2021.

The report accuses the company of 90 counts of wrongdoings including fraud and influence-peddling, amounting to a total of around $3 billion, Fars said.

According to the parliamentary report, which was published by several local media outlets, the firm paid huge sums of money to officials at government institutions and other influential bodies.

They included figures at the intelligence and industry ministries and provincial governors’ offices, as well as the judiciary, the police, state broadcaster IRIB, members of parliament and clerics.

In January last year, conservative Iranian lawmakers voted to launch an investigation into Mobarakeh’s affairs to examine issues including “the reasons for its decrease in export volume, illegal appointments, the payment of exorbitant salaries and the signing of ambiguous contracts”, the parliamentary report said.

The report also accuses officials from the government of former moderate president Hassan Rouhani of appointing Mobarakeh’s managerial team and board members.

Fars said the parliamentary report had been referred to the judiciary for further investigation, but judicial authorities have not yet announced whether a probe has been opened.

In June Iran’s supreme leader Ayatollah Ali Khamenei, who has the final say in major state policies, called on the judiciary to “seriously” fight corruption.

Transparency International’s 2021 Corruption Perceptions Index ranked Iran 150 out of 180 countries.