Paper Reports $19 Million Embezzlement In Iran Air Purchase Of Aircraft

Iranian daily Jahan-e-Sanat has reported an alleged embezzlement case of about $19 million in the process of purchasing three aircraft by Iran’s national flag carrier, Iran Air. 

The newspaper revealed on Wednesday that the airliner signed a contract through an intermediary company to buy three Airbus A319s at $44.3 million dollars in 2019, but when their documents were registered by banks their value was estimated to be $25.5 million. 

Airbus A319 is a member of the Airbus A320 family of short- to medium-range, narrow-body, commercial passenger twin-engine jet airliners manufactured by Airbus, and its list price for a brand-new model can reach up to $100 million. Since the Islamic Republic is not allowed to buy new airplanes due to US sanctions, it has to buy used ones via brokers or intermediaries, which makes the pricing process an issue vulnerable to corruption by middlemen. 

According to Alireza Barkhor, the deputy chairman of the Association of Iranian Airlines, more than 50 percent of Iran’s passenger planes are idle due to lack of spare parts, particularly engines.

The United States sanctions, which banned the sale of aircraft and parts to Iran in 1995, have practically made it impossible for most manufacturers to sell parts to Iran.

When the 2015 nuclear agreement went into effect, sanctions on purchases of Western aircraft were lifted and Iran began talks to buy aircraft from Boeing and Airbus. A few airbus planes were delivered but the Trump administration never approved sale of US planes until Washington withdrew from the JCPOA in May 2018 and reimposed sanctions.