The government can seize a skyscraper in Midtown Manhattan that it says is controlled by Iran, a jury concluded on Thursday, allowing federal prosecutors to complete what they called the largest terrorism-related civil forfeiture in United States history.
The jury, which deliberated for one day after a month of testimony, found that the Alavi Foundation, which owns 60 percent of the 36-floor skyscraper at 650 Fifth Avenue, violated United States sanctions against Iran and engaged in money laundering through its partnership with Assa Corporation, a shell company for an Iranian state-controlled bank that had owned the remaining 40 percent.
Defense lawyers had argued that Alavi did not know of Assa’s ties to the Iranian government after the United States imposed sanctions in 1995.
The government has agreed to distribute proceeds from the building’s sale, which could bring as much as $1 billion, to the families of victims of Iranian-sponsored terrorist attacks, including the Sept. 11 attacks. The office tower is highly coveted real estate; Nike recently signed a 15-year deal to rent seven of its 36 floors.
The jury also upheld the government’s claim to several Alavi bank accounts and shares of other properties in New York, Texas, California and Maryland that were funded by the skyscraper’s rental revenue.
“In this trial, 650 Fifth Avenue’s secret was laid bare for all to see,” Joon H. Kim, the acting United States attorney for the Southern District of New York, said in a statement. “The owners of 650 Fifth Avenue gave the Iranian government a critical foothold in the very heart of Manhattan through which Iran successfully circumvented U.S. economic sanctions.”
Alavi, which has donated to health clinics, Persian cultural programs and universities including Columbia, said in a statement that it was disappointed by the verdict and was considering its options. Defense lawyers were expected to appeal the decision.
The government first filed its complaint in 2008. In September 2013, Judge Katherine B. Forrest, of Federal District Court in Manhattan, ordered Alavi and Assa to forfeit their shares of the building. But an appeals court in 2016 sent Alavi’s portion of the case back to trial, on the ground that it was unclear if the foundation actually knew its partner was controlled by Iran. The government retained control over Assa’s share.
During the new trial, neither the prosecution nor the defense disputed that Alavi, a charity established by the shah of Iran in the 1970s, knew Assa was state-run when the two entered into joint ownership of the building in 1989. But John Gleeson, one of Alavi’s lawyers, said the foundation was duped into believing that private owners took over Assa after the 1995 sanctions.
He pointed to a series of letters between Alavi and Assa, in which the charity’s lawyers tried unsuccessfully to arrange a face-to-face meeting with the supposed new owners.
Alavi was “stonewalled,” Mr. Gleeson said during closing arguments.
“It’s really difficult to understand why you can be held accountable for the knowledge that you were trying to get, but you were lied to about,” he said.
Source » newyorktimes