VZCZCXRO8538
PP RUEHBC RUEHDE RUEHKUK
DE RUEHDIR #0030/01 1641446
ZNY SSSSS ZZH
P 121446Z JUN 08 ZDK
FM IRAN RPO DUBAI
TO RUEHC/SECSTATE WASHDC PRIORITY 0279
INFO RUCNIRA/IRAN COLLECTIVE
RUEHDIR/IRAN RPO DUBAI PRIORITY 0272
RHEFDIA/DIA WASHINGTON DC
RUEAIIA/CIA WASHDC
RHEHAAA/NSC WASHINGTON DC
RUEHDE/AMCONSUL DUBAI PRIORITY 0242
RUEHAD/USDAO ABU DHABI TC
RUEHAD/AMEMBASSY ABU DHABI PRIORITY 0210
RUEATRS/DEPT OF TREASURY WASHINGTON DC

S E C R E T SECTION 01 OF 03 IRAN RPO DUBAI 000030 
 
NOFORN 
SIPDIS 
 
E.O. 12958: DECL:  6/12/2018 
TAGS: PGOV PREL IR
SUBJECT: AHMADINEJAD ASSOCIATE ARRESTED AFTER ACCUSING CLERICS OF 
CORRUPTION 
 
DUBAI 00000030  001.2 OF 003 
 
 
CLASSIFIED BY: Jillian Burns, Director, Iran Regional Presence 
Office, Department of State. 
REASON: 1.4 (b), (d) 
 
 
 
1.(S//NF) Summary:  Abbas Palizdar, a minor Iranian politician 
associated with President Ahmadinejad, is making headlines after 
publicly accusing high-ranking conservative clerics of economic 
corruption and then being arrested.  It is not yet clear what 
his motivation was or what impact his speeches will have.  Two 
Iranian contacts said they believe Palizdar's speech was given 
with the permission of Ahmadinejad in order to divert attention 
from the government's mistakes and/or make it appear the 
government was fighting against corruption.  However, it does 
not appear that the accusations received much coverage in 
domestic press until picked up outside the country, which would 
seem to undercut that argument.  Palizdar later gave an 
interview to Radio Farda, which is taboo in Iran (unless 
authorized by the government, as one contact surmised).  He was 
then reportedly arrested June 11, accused of publishing lies and 
disturbing public opinion, according to Fars News.  One 
Dubai-based analyst said that the significance of Palizdar's 
speech is not necessarily the accusations he made against 
important clerics, since rumors of corruption by prominent 
figures abound in Iran, but whether the fall-out from these 
accusations impacts the Supreme Leader's support of Ahmadinejad. 
 End Summary. 
 
The accusations 
 
--------------- 
 
2.(U) Abbas Palizdar, a minor Iranian politician associated with 
President Ahmadinejad, reportedly gave speeches in May at 
Hamedan and Shiraz Universities, in which he accused high level 
Iranians of corruption.  Among those he accused were members of 
the Guardian Council, Expediency Council, influential clerics 
from Qom and Mashhad and even close advisors of the Supreme 
Leader.  According to press reports, Palizdar's accusations 
included the following: 
 
-- Guardian Council member and temporary Friday prayer leader of 
Tehran Imanmi Kashani reportedly used his child's disability as 
a justification for taking over the licensing and operations of 
four mines.  Kashani reportedly asked for the revenues from the 
mines to construct a physical therapy center for his son. 
 
-- Guardian Council member, Assembly of Experts member, former 
head of the judiciary, and head of the Teachers of Qom 
Theological Center Mohammad Yazdi reportedly made a large profit 
on a tire company after acquiring it at a fraction of its actual 
cost.  Yazdi was also accused of using his position of power to 
secure logging rights for his son in northern Iran. 
 
-- Former speaker of the Majles and advisor to the Supreme 
Leader Ali Akbar Nateq Nouri, former head of the Mostazafin 
Foundation Mohsen Rafiqdoost, former Secretary of the 
conservatives Islamic Coalition Association Asqar Oladi, Deputy 
Director of the Supreme Leader's Office (presumably 
Abdolhossein) Moezi, former Intelligence Minister Ali Fallahian, 
and the Mashhad cleric Ayatollah Elm Alhoda were all accused of 
fraud charges involving Iran Khodro car manufacturing plant. 
 
-- The Supreme Leader's representative in Khorasan province 
Ayatollah Vaezi Tabasi reportedly had 13 mines handed over to 
him. 
 
-- Ayatollah Makarem Shirazi's son-in-law (FNU) Modalal was 
called the "king of the sugar mafia." 
 
-- When asked about former president Rafsanjani and his family, 
Palizdar reportedly said, "their economic corruption is so wide 
that it is not possible to list them.  But one of them is in 
their lack of payment of taxes to the government." 
 
Who is this guy? 
 
---------------- 
 
3.(S//NF) Press reports and Iran analysts differ on Abbas 
Palizdar's current or former positions.  Reformist newspaper 
E'temad called Palizdar a "barely known principle-ist" before he 
made his speech at Hamedan.  A Tehran-based political and 
 
DUBAI 00000030  002.2 OF 003 
 
 
economic analyst called him "a former economic counselor to 
parliament and an ally of President Ahmadinejad."  Later, in a 
newsletter to clients, the analyst said Palizdar is a "former 
member of the Majles' Judicial Inquiry and Review Commission and 
now Head of Parliament's Office of Infrastructure Studies." 
 
4.(S//NF) A purported former IRGC general told IRPoff that 
Palizdar is very close to Ahmadinejad and that Palizdar was the 
government's representative to the Majles Judicial Inquiry and 
Review Commission, which he described as the parliamentary 
committee that investigates corruption charges.  He said 
Palizdar was not a member of parliament.  The same source 
claimed that Palizdar waQormer IRGC member who had worked 
for him when the general ran the IRGC human resources 
department, presumably in the 1980s.  The general claimed 
Palizdar was extremely hardline, which necessitated close 
monitoring of his activities.  The former general also claimed 
that the source of Palizdar's information came from complaints 
that had been submitted to the Majles commission and may or may 
not be true, but had not been proved.  He said that the head of 
the commission had distanced himself from Palizdar's claims. 
Saeed Aboutaleb, whom the general claimed was the head of the 
commission, was quoted in the Washington Post saying that 
Palizdar "was helping one of the parliament members as an expert 
but wasn't present in the sessions of the committee that deals 
with corruption issues." 
 
Palizdar's motivation? 
 
---------------------- 
 
5.(S//NF) What remains unclear is whether or not Palizdar was 
directed by President Ahmadinejad to launch an attack against 
conservative elements who are not considered allies of the 
president.  Press reports claim that Palizdar did not initially 
mention names in his speech, only accusations, but started 
naming names when pressed by the audience.  According to 
semi-official Fars News, Palizdar's accusations were based on a 
study he wrote that was reportedly commissioned by Ahmadinejad. 
Initial press reports were quick to point out that Palizdar did 
not accuse any of Ahmadinejad's close allies of corrupt 
practices.  According to BBC Persian, Hamedan University's 
Islamic Association is closely associated with Ahmadinejad. 
Non-governmental media outlets also associated Palizdar with 
Ahmadinejad, particularly since Palizdar ran unsuccessfully in 
2006 for Tehran's provincial council on a list that supported 
President Ahmadinejad. 
 
6.(S//NF)  The Tehran-based political and economic analyst 
claimed that some analysts believe that "Palizdar's intervention 
may have been a mechanism to test the limits of the government's 
criticism of the country's non-elected organs at a time when 
talks of (Supreme Leader) Khamenei's succession and the future 
of the velayat-e-faqih are taking shape." 
 
7.(S//NF) Two IRPO contacts maintained that Palizdar spoke on 
behest of the president to divert blame and attention from 
government mismanagement, or to give the appearance of tackling 
the problem of corruption, particularly in the face of a new 
Majles full of presidential critics.  One of them, a former 
staff member of the Guardians Council, was particularly 
dismissive of the incident, saying that these claims of 
corruption made by Palizdar were old and widely known.  He felt 
that the speech was inconsequential political theater by 
Ahmadinejad, and none of those accused by Palizdar would be 
prosecuted.  (Comment: The fact that the speeches apparently got 
little domestic press coverage until picked up by oppositionist 
media would seem to undercut these arguments that the speech was 
deliberate Ahmadinejad-directed propaganda.  End comment) 
 
8.(U) However, on June 11, BBC Persian noted a rush of Iranian 
press accounts critical of Palizdar and claimed that groups 
close to Ahmadinejad (no further information) appeared to be 
trying to distance themselves from him.  Fars News reported that 
Bank Mellat is pressing charges against him for not replaying a 
business loan he received 16 years ago of more than $6 million. 
 
9.(U) In an editorial, BBC Persian asserted that Ahmadinejad 
supporters, particularly students calling for an end to economic 
corruption, may now feel let down by the president since his 
government appears to be abandoning Palizdar.  According to 
BBC's analysis, Ahmadinejad may be under pressure - including by 
those who were named by Palizdar - to stop talking about 
economic corruption.  If anyone takes too close a look at major 
 
DUBAI 00000030  003.2 OF 003 
 
 
economic dealings in Iran, the entire government would be 
implicated. 
 
10.(S//NF)  Accusations of corruption are nothing new in Iran, 
underscored a Dubai-based Iran analyst to IRPoff.  Politicians 
are continually involved in "character assassination of one 
another," he said.  This source said it is more important to 
step back and do a cost-benefit analysis of whether or not - 
given the latest accusations against people close to the Supreme 
Leader - Khamenei would continue to support Ahmadinejad.  He 
argued that Ahmadinejad had served his purpose in the eyes of 
Khamenei; Ahmadinejad had diminished the role of Rafsanjani and 
pushed out reformists.  If Ahmadinejad and his allies continue 
to isolate themselves and challenge leading clerics, it may be 
too costly for the Supreme Leader to continue to back 
Ahmadinejad.  In any case, added the analyst, it is still "too 
soon" to make any clear predictions over Ahmadinejad's future. 
 
11.(C) Comment:  The most interesting aspects of this case to 
date have been:  1) the fact that an associate of Ahmadinejad 
gave an interview to Radio Farda --during which he boldly 
defended his accusations and promised to reveal more evidence to 
support his claims -- an act that is proscribed in Iran and has 
gotten others jailed; and 2) reports that Palizdar has now been 
arrested.  One source claimed that Palizdar would not have 
spoken to Radio Farda without authorization from Ahmadinejad, 
which if true, would indicate a cunning use by the president of 
USG media.  However, the source's comment came prior to the news 
of Palizdar's reported detention.  Whatever the circumstances, 
none of our contacts to date view Palizdar's speech as a 
watershed event in Iranian politics likely to result in any real 
change.BURNS