Judge Admonishes Prosecutorial Team Over Iranian Sanctions Case Mishaps
In a case against an Iranian banker accused of violating U.S. sanctions on Iran, Judge Alison Nathan for the U.S. District Court for the Southern District of New York lambasted federal prosecutors over their mishandling of evidence and dereliction of responsibility. Stopping short of finding them guilty of knowingly withholding crucial information or intentionally misrepresenting facts to the court, Nathan in a Feb. 22 ruling called for a full investigation of the prosecutors' actions by the Department of Justice's Office of Professional Responsibility and said she hopes the government's reforms on evidence handling training will ensure that similar action is not repeated.
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These same disclosure issues had led Nathan to dismiss the case in September. The lawsuit against Ali Sadr Hashemi Nejad arose when DOJ said he funneled $115 million to his family business, the Stratus Group, to help the Iranian International Housing Co. work with U.S.-sanctioned Petroleos de Venezuela to build housing units in Venezuela (see 2003180019). Despite winning conviction against Sadr, the U.S. asked to withdraw its case due to the disclosure issues (see 2006080026).
Of premier interest to the court was one document, a letter from Commerzbank to the Office of Foreign Assets Control, the prosecutors failed to disclose until days into the trial and now admit held value to the defense's argument, Nathan said. Once discovering this key bank record, the prosecutors delayed handing off the evidence immediately to Sadr's attorneys, as required, and “buried” the record in a list of other documents the following day, she said. The ploy was uncovered in prosecutorial team emails, of which one example could “only be understood as a deliberate attempt to obscure” the bank record, Nathan wrote.
“The Court remains of the view expressed in its September 16 Opinion that the disclosure failures and misrepresentations in this case represent grave derelictions of prosecutorial responsibility,” the judge wrote. “The trial team’s failure to promptly investigate the origins of (the bank record) and to communicate about discovery with other governmental agencies reflects a systematic disregard of their disclosure obligations. Prosecutors then compounded these missteps through a sustained pattern of refusing to fess up.”
Additional claims of misconduct included the misuse of search-warrant returns that were used only for proof of state crimes, not federal ones. Had this information been presented along with the search warrants themselves, the evidence obtained from the warrants may not have been used in court, Nathan said. “Only following multiple orders directing the Government to study its conduct in this case, many months since trial has concluded, have these troubling details finally come to light,” Nathan wrote.
Email ECDNews@warren-news.com for a copy of the opinion and order.