Canadian sanctions against Iranian company don't cover board member with business interest in B.C.

An Iranian businessman who owns shares and sits on the board of a private Tehran-based company that has been sanctioned by Canada for co-ordinating the transport of weapons to Russia has a registered company in British Columbia, The Fifth Estate has learned.

In the latest corporate records filed in Iran's official journal, Mohammad Bagher Nahvi is listed as deputy chair of Safiran Airport Services. 

The cargo and commercial airline is one of five entities sanctioned by Global Affairs Canada (GAC) last November for what the federal government says is their role in the Iranian regime's "gross and systematic human rights violations and actions that continue to threaten international peace and security."

GAC alleges that Safiran "co-ordinated Russian military flights between Iran and Russia, through which the Iranian regime transferred lethal Iranian-made unmanned aerial vehicles (UAVs) to Russia."

The U.S. Department of the Treasury sanctioned Safiran Airport Services in September 2022 for coordinating "Russian military flights between Iran and Russia, including those associated with transporting Iranian UAVs, personnel, and related equipment from Iran to Russia."

Nahvi is also listed on the boards of other Iranian companies that appear to be part of the same Safiran group, including Safiran Freight and Cargo Services, which continues to advertise shipping services to Canada online. According to Iranian corporate governance rules, only shareholders of private companies can be members of the board, although they are not required to disclose the number of shares they own.

The Canadian sanctions on Safiran Airport Services do not extend beyond the corporate entity to company officers and directors or their families. 

Critics say listing only the company limits the effectiveness of the sanctions.

"From a financial warfare point of view, it makes sense that when you go after an entity, you go after the executives, you go after the board and you go after the family of members of the executive and the board," said Saeed Ghasseminejad, an Iran sanctions expert at the Washington, D.C.-based think-tank Foundation for Defense of Democracies. 

"If you don't go after the high-level executives and members of the board, it's very easy that they can go and create a front company and engage in their operation. So [sanctioning the corporate entity] creates a problem, but it's not that difficult to go and replace that operation under another name."

In Canada, Nahvi is listed as one of three directors of Solabest Development Inc., an active company registered in British Columbia. In corporate registry documents, Nahvi lists a condo unit in Vancouver as his address.

Solabest Development Inc. was incorporated in B.C. in November 2021 and filed its latest annual return in November 2022, according to the corporate records.

On Nov. 1, 2022, an individual named Ensieh Nahvi was newly listed as one of the three directors of Solabest Development Inc. 

The Fifth Estate has viewed a copy of Ensieh Nahvi's Iranian identity booklet that includes the first name of her father Mohammad Bagher and his national ID number, which matches the national ID number for Mohammad Bagher Nahvi on Safiran's corporate documents.

According to B.C. property records, Ensieh Nahvi is on the title of a five-bedroom house in North Vancouver purchased on Nov. 8, 2022, for nearly $4.9 million. The records show Nahvi paid cash for the property.

The Vancouver real estate agent who had the listing for the house told The Fifth Estate that Mohammad Nahvi personally came to view it before the purchase. 

'My own asset'

In a telephone interview, Ensieh Nahvi denied she was his daughter, saying only that she was a relative. She said that she comes from a wealthy family in Iran, that she owned real estate there and purchased the North Vancouver house with her own money. 

[The house] is mine with my own asset," Ensieh told The Fifth Estate in Persian. "I had a house which I sold. I submitted all the documents to the bank."

She said her family was not connected to the government of the Islamic Republic and directed questions about Safiran to Mohammad Nahvi.

Mohammad Nahvi did not respond to multiple emails, calls and messages requesting an interview for this story.

Government says it is 'judicious' in sanctions

In an email to The Fifth Estate, GAC said that the federal government is "judicious in its approach to imposing sanctions, both against individuals/entities and against states" and that the sanctions prohibit Canadians inside and outside Canada from having any transactions with Safiran.

"If we actually want our sanctions regime to be effective, we need to go beyond symbolism and we need to think about how to use sanctions in a way that forces Iranian officials and those affiliated with the regime to change their behaviour," said Kaveh Shahrooz, an Iranian-Canadian Lawyer and Senior Fellow at the Macdonald-Laurier Institute. 

"Merely sanctioning a company will likely not achieve that. What you need to do is put pressure on the people who run the company in order to get them to change their behaviour."

In reaction to the Iranian regime's crackdown against human rights protesters last fall, the Canadian government introduced a number of sanctions against Iranian individuals and entities. The measures announced on Oct. 7 also earmarked $76 million to "strengthen Canada's capacity to implement sanctions and ensure we can move more quickly to freeze and seize sanctioned individuals' assets."

At the time, GAC said it was setting up a dedicated sanctions bureau in the department and providing additional support to the RCMP to investigate and identify assets and gather evidence.

Brandon Silver, an international human rights lawyer with the Raoul Wallenberg Centre for Human Rights in Montreal, told The Fifth Estate that Canada's current legislation is broad enough to allow the government to take meaningful action against company officials and their family members. It comes down to the government's will to extend the sanctions to individuals.

"If there's Canadian complicity by allowing our markets, our banking institutions, our economy to be leveraged by these corporations and those individuals that really allow these corporations to thrive, we have to put an end to that," Silver said.

Similar sanctions in U.S.

Like Canada, the U.S. did not extend the sanctions to Safiran officers and directors or their families. 

Iran sanctions expert Ghasseminejad believes lawyers at the U.S. Department of the Treasury are making the call on how far to extend sanctions in each case. 

"The legal question is let's say you want to go after the board – can you prove that the board is responsible for that action or not in court?"  he told The Fifth Estate. 

"Board members in general, they may not be aware of everything – everyday activities. But in many countries I think that they are responsible for major decisions made by the company."

The U.S. Treasury did not respond to questions from The Fifth Estate.

Over the last several months, the U.S. government has continued to sanction Iranian entities and individuals for the production and shipment of deadly drones to Russia.

On Jan. 6, the U.S. Treasury Department sanctioned six executives and board members of Iran's Qods Aviation Industries for the production of drones used by Russia in its war against Ukraine.

Recently, U.S. President Joe Biden's national security adviser, Jake Sulivan, said that Iranian drones may be "contributing to widespread war crimes" in Ukraine.

"The way that they are actually carrying them out physically makes physical interdiction a challenge," Sullivan said at a media conference in Mexico City on Jan. 9, referring to the shipment of drones from Iran to Russia. 

"But we will not stop at a variety of means of seeking to disrupt this type of ongoing military co-operation and to continue to increase the cost to Iran — in the court of public opinion, with respect to economic pressure — for deciding to go down a road where their weapons are being used to kill civilians in Ukraine and to try to plunge cities into cold and darkness."