U.S. Department of Justice
U.S. Attorney's Office, Southern District of New York
August 19, 2002

Contact:
Marvin Smilon, Herbert Hadad, or
Michael Kulstad
Public Information Office
Phone: (212) 637-2600
or (718) 422-1870

JAMES B. COMEY, the United States Attorney for the Southern District of New York, announced that MAZYAR GAVIDEL was convicted after a two-week trial in Manhattan federal court late last week on charges of money laundering conspiracy, money laundering, structuring financial transactions, and violation of the U.S. embargo on trade with Iran. In addition, his company HOMA INTERNATIONAL TRADING CORP. ("HOMA") was convicted on charges of money laundering conspiracy, money laundering, and violation of the Iran embargo.

According to the evidence at the trial, GAVIDEL was president and sole proprietor of HOMA, an unlicensed money transmitting business GAVIDEL operated in midtown Manhattan from 1996 until GAVIDEL's arrest in November 2000. The principal business of HOMA during this period was the unlawful transfer of money to Iran in violation of the U.S. Embargo of that country. In addition to his New York business, GAVIDEL ran part of his illegal operation with a partner based in Montreal, Canada.

According to the evidence at trial, GAVIDEL and HOMA laundered a total of approximately $400,000 in cash from a confidential informant working at the direction of the U.S. Customs Service. GAVIDEL was told the funds were proceeds of drug deals, and he agreed to wire the money to bank accounts in London, England, that GAVIDEL understood belonged to drug dealers. In reality, the U.S. Customs Service supplied the money as part of its investigation.

Proof at trial included recordings of numerous telephone conversations and meetings, in Farsi and English, among GAVIDEL, GAVIDEL's Canadian partner, and the informant. The evidence demonstrated that GAVIDEL openly discussed with the informant the "drug money" that GAVIDEL was to wire and was told about the "drug dealers" who purportedly were the informant's bosses.

The evidence at trial further showed that at about the same time, GAVIDEL and HOMA were laundering more than $700,000 worth of actual drug proceeds for a money laundering group associated with Colombian narcotics traffickers. GAVIDEL wired these funds to bank accounts in Panama, Barbados, and Honduras.

As part of his money laundering scheme, between November 1998 and June 2000, GAVIDEL used the cash he was given to make structured purchases of more than $600,000 worth of U.S. Postal Service money orders, in violation of federal reporting requirements. The evidence showed that GAVIDEL structured his cash purchases of money orders of $3,000 or more to illegally evade the requirement of presenting identification and having the transaction documented. Specifically, on more than 50 occasions, GAVIDEL made multiple small purchases of postal money orders at various post office locations - as many as 11 on a single day - in a manner designed to evade detection by keeping them below the $3,000 threshold. GAVIDEL completed the money orders in his name, the name of his company HOMA, and the names of relatives and friends, and then deposited the money orders into HOMA's business bank account. The evidence at trial also showed that GAVIDEL exchanged more than $500,000 worth of what he understood was drug money for checks from various business accomplices, including numerous carpet dealers.

The evidence at trial also showed that HOMA's principal business was transferring funds from third parties to accounts and individuals around the world, particularly in Iran. During the time GAVIDEL was operating HOMA, there was an embargo against trade with Iran, prohibiting all exports to Iran, including the financial services that GAVIDEL and HOMA provided. As the evidence at trial showed, GAVIDEL disguised his transfers of funds to Iran by sending them in bulk through third parties, principally a broker based in Dubai, United Arab Emirates. In total, between mid-1998 and 2000, GAVIDEL illegally transferred approximately $2 million to Iran through Dubai. Proof at trial of this offense included extensive accounting records maintained by GAVIDEL of his illegal transfers to Iran, as well as numerous intercepted faxes from accomplices in Iran and Dubai confirming the receipt and deposit of funds in Iran. Trial evidence also showed that, when questioned by the Treasury Department's Office of Foreign Assets Control ("OFAC") about HOMA transactions destined for Iran, GAVIDEL falsely stated that, "at no point had business relations or the transfer of funds between [HOMA] and Iran existed" and described HOMA's business as merely an "importer, exporter and trader of various products in the Middle East and Far East."

Following GAVIDEL's conviction, he was remanded to the custody of the U.S. Marshals Service.

Mr. COMEY stated: "Federal law enforcement is committed to pursue those who help narcotics traffickers launder their ill-gotten gains as vigorously as the traffickers themselves. Let this case also serve as a warning to those who conduct illegal trade with embargoed countries such as Iran that their illegal businesses will be shut down and the principals of those businesses will be criminally prosecuted."

Mr. COMEY praised the efforts of the Customs Service, the U.S. Postal Inspection Service, the New York State Police, the New York City Police Department, and the Royal Canadian Mounted Police for their assistance in connection with this case.

United States District Judge THOMAS P. GRIESA, who presided at the trial, scheduled November 19, 2002, for the sentencing of GAVIDEL and HOMA. GAVIDEL faces a maximum sentence of 20 years in prison on each of the five money laundering charges and the conspiracy charges in the Indictment; and a maximum sentence of 10 years in prison on the structuring and Iran embargo charges. The maximum fine for each charge is $250,000, or twice the gross gain or loss resulting from the crime. HOMA faces a maximum fine of $500,000 on each charge.

GAVIDEL, 36, lives in Queens, New York. HOMA is no longer in business.

Assistant United States Attorneys PETER B. SOBOL and MARK F. MENDELSOHN are in charge of the prosecution.

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