By Matthew Levitt
December 17, 2008

The U.S. Treasury designated ASSA CORP., a New York front company created and controlled by Iran's Bank Melli, as well as its parent organization in the Channel Islands, ASSA CO. LTD. Treasury noted that Bank Melli's deceptive financial practices and proliferation financing led the United States, the European Union and Australia to designate Bank Melli, and the United Nations to issue a call for vigilance with respect to all Iranian banks. The United Kingdom also released a "supplemental notice on Iran" related to Bank Melli. According to the Treasury Department:

ASSA CORP. has repeatedly transferred rental income generated from the 650 Fifth Avenue partnership back to Bank Melli through ASSA CO. LTD. ASSA CORP. also has regularly followed Bank Melli's instructions with regard to ASSA CORP.'s affairs and its management of the investment, and has regularly reported back to Bank Melli on its financial situation, including frequently responding to Bank Melli requests for audits and information regarding company expenses.

Perhaps most interesting, however, is that according to Treasury "ASSA CORP. co-owns the building through a partnership formed with the Alavi Foundation of New York, called 650 Fifth Avenue Company."

The Alavi Foundation has long been suspected of serving as a front for Iran . In the course of a Senate Finance Committee probe in 2004, the committee requested asked the IRS for records on the Alavi Foundation and several other Islamic charities. Former U.S. officials, including former senior FBI counterterrorism official Oliver "Buck" Revell, linked the Alavi Foundation to Iran more than a decade ago. A 1996 press report quotes Revell, as stating that the Alavi Foundation was "essentially an arm of the Iranian government operating through" the UN mission in New York . One of its functions was that "it keeps track of Iranian nationals in the U.S. and funds groups loyal" to Ayatollah Khanenei.

In a 2002 affidavit, former CIA deputy director and NYPD Deputy Commissioner David Cohen, reportedly also described the Alavi Foundation as "totally controlled by Iran ." According to press coverage of the affidavit:

The reference to the Alavi Foundation comes in a document Mr. Cohen filed September 12, 2002, signed under penalty of perjury. In a section of the declaration headed "terrorist activity," the declaration states, "The Alavi Foundation is a non-profit charitable organization ostensibly run by an independent board of directors but totally controlled by the government of Iran . The foundation has assets of about $100,000,000 in the U.S. and an annual income of between $10-15 million. The foundation funds a variety of anti-American causes, including the four Islamic education centers it owns in New York , Maryland , Texas and California .

"The Maryland center is headed by Mohammad Al Asi, an American convert to Islam who, during the Kuwait crisis, called on Muslims to strike against American interests in the Middle East . Mosques funded by Alavi have organizations which support Hezbollah and Hamas."

Treasury's press release announcing today's designation assures the action "does not interfere with the business and other activities of the tenants of 650 Fifth Avenue , and U.S. persons are not prohibited from dealing with business establishments or other tenants of the building." The tenants may not have anything to worry about, but the action may be a shot across the bow of the building's co-owner, the Alavi Foundation.

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