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Feds Investigating Iran Ties to Firm Involved in US Visa Program

3 Feb

Federal agents in Los Angeles are investigating an L.A. shipping firm and its Iranian-born owner who for years have participated in and promoted an obscure U.S. immigration program — allowing the company to recruit wealthy foreign investors to receive visas and potentially Green Cards, law enforcement sources told ABC News.

The company’s name surfaced in a confidential Department of Homeland Security government document, which raised “concerns that this particular visa program may be abused by Iranian operatives to infiltrate the United States.”

Whistleblowers inside the federal agency that oversees the immigration program told ABC News they have been deeply frustrated by an inability to de-certify the company, even after they became aware of the investigation and saw the company’s name surface in an alarming internal Department Homeland Security memo. The memo, shared with ABC News, outlines concerns that Iran’s Revolutionary Guards have attempted to exploit the visa program “to infiltrate the United States.”

The program, known by the visa designation “EB-5,” offers wealthy foreign investors a way to bypass the traditional route to a Green Card. It requires they invest between $500,000 and $1 million in a certified company or project that creates U.S. jobs. The Los Angeles company, American Logistics International, first applied to participate in the program in 2009 and first began submitting names of investors for visa approval in 2011.

U.S. Sen. Charles Grassley said the case of American Logistics was recently brought to his attention by whistleblowers inside the federal agency who were frustrated that it was so difficult to disqualify companies participating in the EB-5 program, no matter how serious their concerns.

“The whistleblowers have come forward and said there’s reason to be concerned whether our national security is being comprised,” Grassley said.

American Logistics executives declined to be interviewed, but an attorney for the company said neither the company nor its owner, Alireza Mahdavi, have engaged in any illegal activity.

The company has maintained its certification to be part of the immigrant visa program, even as agents served a search warrant at the offices of a second shipping company, looking for records about American Logistics and its owner. Documents show investigators were looking into ties between a former employee of the second firm, Total Transportation Concepts (TTC), and American Logistics because the two companies shared common owners and executives, including Mahdavi.

The records show that the TTC employee was suspected of ties to an Iranian terror network that was involved in bombing plots and attempted assassinations. In 2012, federal investigators sent an email to immigration officials to advise them against re-certifying American Logistics for the immigration program, warning that an approval “would likely have serious national security implications.”

“I strongly advise against a favorable adjudication,” wrote a Homeland Security Special Agent in the Counter-Proliferation Investigations Center in the April 30, 2012 email.

But agents with United States Citizenship and Immigration Services (USCIS) moved forward and green-lighted American Logistics and Mahdavi, to continue overseeing a designated “regional center” for a special U.S. immigration program for wealthy foreigners known by its visa classification, EB-5.

The case has never been the subject of media attention, but it has for years been the subject of significant behind-the-scene deliberations about the potential national security risks associated with the foreign investor immigration program -– a debate that went all the way to the White House, internal USCIS records show.

Grassley, chairman of the powerful Senate Judiciary Committee, and a critic of how the EB-5 foreign investor visa program has been run, is sounding alarms about the issue. After hearing from whistleblowers, Grassley posted on his official website a heavily redacted document that described serious concerns about one of the companies that had been certified as a regional center –- and thus would be able to recruit foreign investors into the country in exchange for the promise of a quick and easy visa approval.

The document describes USCIS “concerns that this particular visa program may be abused by Iranian operatives to infiltrate the United States.” It says that as early as 2010, immigration officials began receiving warnings about a group of individuals who may be trying to “facilitate terrorism” and be “involved in an illicit procurement network that exports items to Iran for use by secret Iranian government agencies.”

ABC News has reviewed an un-redacted copy of the document, which alleges that one of those individuals, at the time a TTC employee, had suspected ties to a network involved in “leading assassination and terrorist operations in Sri Lanka, Thailand and the country of Georgia.” It says a contact of that employee “procured the same size and type of ball bearings found in improvised explosive devices” discovered in the Thai apartment of a suspected terrorist.

The document specifically focuses on TTC and on the American Logistics presence in the EB-5 immigration program. Separate Homeland Security Investigations documents reviewed by ABC News describe American Logistics as the subject of a federal probe into “possible [Office of Foreign Asset Control] violations by the investors,” and identify several individuals with ties to one or the other company who were subjects of counter-proliferation investigations being run out of Los Angeles and Boston.

In 2014, law enforcement sources told ABC News that the Transportation Security Administration initiated action against TTC and Mahdavi, suspending their ability to move international cargo unescorted. A copy of the April 25, 2014 TSA suspension notice addressed to Mahdavi and reviewed by ABC News, said the agency “has determined that you no longer meet the TSA’s security threat assessment standards and may pose an imminent threat to transportation or national security, or of terrorism.” The source said TTC and Mahdavi appealed the TSA finding, and the matter is currently pending before a federal administrative court.

It is not the first time Mahdavi has pushed back against government attempts to restrict his activities. In 2012, he gave an interview to the New York Times to complain about being mysteriously ejected from the Global Access program, which had been allowing him to move easily through U.S. customs as he traveled.

“Since October of 2011 we’ve been after this and I haven’t gotten any valid or sensible response,” Mahdavi told The Times. “I want to know what made them revoke this privilege.”

Mahdavi’s lawyer suggested in the report that his frequent travel to Iran may have triggered a red flag.

Mahdavi has declined repeated requests from ABC News for an interview. His attorney, Richard Steingard, wrote to say he and his client strongly objected to any assertion that Mahdavi or American Logistics (ALI) have been involved in any illegal activity.

“To be clear, neither Mr. Mahdavi nor ALI is involved in any terrorist or illegal export activities,” he wrote. Steingard said the same of other companies Mahdavi “is or was affiliated” with, such as TTC.

Calls to TTC to ask about Mahdavi were not returned. Steingard did not respond to any questions about the federal investigation.

An official with American Logistics, Craig Carter, also wrote an email to ABC News in response to questions saying that the company makes complying with all laws and regulations its “highest priority.” He wrote that the company sought and received specific approvals from the Treasury Department to accept funds from Iranian investors.

“We trust and believe in our government’s intelligence capabilities to screen and prevent entry into the United States by applicants whose ‘motives and background’ are truly suspect,” Carter wrote. “In point of fact, none of the Iranian investors who have participated in the EB-5 program through the A.L.I. Regional Center has ever been refused a visa because of security concerns. In addition, all of our investors have been screened both through the EB-5 program’s requirement that an investor verify the actual source of the funds to be invested, our own internal safeguards and the government’s security checks.”

Carter also disputed the notion that Total Transportation was an affiliate of American Logistics. However, licensing records from the Federal Maritime Commission, obtained by ABC News under the Freedom of Information Act, show that the company was co-owned by Mahdavi. Records show Mahdavi resigned his position and sold his interest in TTC in 2014.

Carter says the Total Transportation employee who was ultimately convicted of illegally shipping electronics to Iran was a “rogue employee of Total Transportation Concept, who established one or more corporations to further his own interests and purposes, acted independently, and conducted his nefarious activities without either the knowledge, consent or participation of anyone at Total Transportation Concept.”

By all outward appearances, American Logistics is a thriving shipping and trucking concern based in Carson, California, just a few miles from the Port of Los Angeles. Every hour, numerous big rigs roll in and out of the company’s gated warehouse. The company’s website touts its ability to “provide an efficient, secured and comprehensive cargo transport handling and warehousing operations throughout North America.”

Michael Gibson, a consultant who helps foreigners research immigrant investment opportunities in the U.S., said Mahdavi struck him as a well-meaning and thoughtful business man when he gave Gibson a tour of the company facilities several years ago. Mahdavi even showed Gibson part of pop singer Michael Jackson’s antique car collection, which, he was told, American Logistics had been hired to store in one of its warehouses.

In a 2010 prospectus for potential foreign investors, obtained by ABC News, the company said it hoped to raise $10 million from foreign investors to help upgrade its truck fleet. It describes Mahdavi as an executive with “over twenty-five years direct executive level, managerial level, financial, operations, human resources and hands-on experience in the distribution, traffic, warehousing, and technologically advanced logistics business.”

American Logistics joined the trade group for EB-5 investment interests, Association to Invest in the U.S.A., and Mahdavi appeared as a speaker at local conferences touting the advantages of the little-known immigration program. He also began getting politically involved, donating the maximum amount allowed to Rep. Darrell Issa, a California Republican, and taking Issa on a tour of the company’s Carson facilities. A spokesman for Issa told ABC News the congressman never took any steps to help the firm, but was an outspoken supporter of the EB-5 immigration program.

At the same time that American Logistics was expanding, Homeland Security officials began expressing concerns internally about the company and specifically its investors’ ties to Iran.

In April 2012, immigration officials exchanged a series of emails with the subject “de-confliction MAHDAVI, Alireza,” in which they sought to determine if it was wise to re-certify American Logistics for the foreign investor visa program. It was in response to that request that the Homeland Security agent wrote to alert immigration officials that “there are national security concerns with American Logistics International and associated individuals, both direct and circumstantial.”

On July 10, 2012, a federal grand jury indicted an employee of TTC – the company once affiliated with American Logistics – and accused him of smuggling sensitive electronics to Iran. The following summer, federal agents conducted a raid at TTC’s non-descript office building, about a mile from Los Angeles International Airport. In the search warrant, agents wrote that they were seeking records “relating to exports or shipments… to Iran” from Mahdavi, TTC, and American Logistics.

And yet, records show American Logistics not only maintained its status as a certified regional center, it continued to receive funds from investors in Iran and other Middle Eastern countries, who in turn were rewarded with visas. Since joining the program, immigration officials told ABC News the company has been able to attract more than $20 million in foreign funds.

Peter Joseph, the head of the trade group that counts American Logistics as one of its members, said he was not aware the company had been the subject of any investigation.

“We’ll have to take a closer look at that,” he said.

ABC News tried to speak with Alejandro Mayorkas, who ran the EB-5 visa program at the time American Logistics was receiving approvals, and has since been promoted to deputy DHS secretary. But when ABC News approached Mayorkas at a public event in Washington, DC, to ask him about it, Mayorkas hustled to his car and sped away, declining to address it.

Late Monday night, more than three months after receiving detailed questions about American Logistics, a DHS official who declined to be identified sent a statement indicating that immigration officials were powerless to de-certify the company from its program.

“USCIS only has the authority to terminate a regional center if there is evidence the center is no longer promoting economic growth – not on the basis of national security concerns,” the statement says. “This lack of discretion limits the ability of the Director or the Secretary to terminate a regional center in the event of suspected or even proven criminal activity.”

Further, the statement says that even though the agency lacked the ability to shut down the regional center, “the Director of USCIS remained uncomfortable with processing applications for this regional center and USCIS initiated its own hold.” The statement does not say when this action occurred.

For years now, internal questions about American Logistics have reverberated within Homeland Security. After a series of meetings, concerns about the potential security risks created by the EB-5 visa program were brought to the White House for a national security staff discussion. The department also began conducting background checks on other regional center owners.

“USCIS has since found a number of links between EB-5 sponsors, businesses, principals, and associated addresses, with the subjects of other [ongoing federal law enforcement] investigations,” one internal DHS memo says.

Grassley said he cannot discuss those cases because they involve classified information. But he said there appears to be a disconnect between public statements from DHS officials who say the security concerns have been addressed, and what is continuing to occur within the program.

“In one setting, we get information that this is nothing to worry about,” Grassley said, adding that DHS officials told him, “We’ve listened to the whistle blowers, we’ve made changes.”

“But in another setting that I don’t want to describe, you get a different opinion,” he said.

This year, the EB-5 program is due to come before Grassley’s committee for re-authorization.