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Monday, February 8, 2010     FOR YOUR EYES ONLY

British firm managed to sell, deliver a 747 to Iran

WASHINGTON — Balli Aviation Ltd., a subsidiary of Britain's Balli Group, has pleaded guilty to the illegal export of a Boeing 747 aircraft from the United States to Iran.   

In a plea bargain, Balli agreed to pay a $2 million fine and placed on corporate probation for five years.

"The significant fine is a direct consequence of the level of deception used to mislead investigators," Thomas Madigan, acting deputy assistant Secretary of Commerce, said after the plea bargain was announced on Feb. 5. "The case agents worked through a complex corporate maze to obtain the facts and bring the violators to justice."


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An indictment filed in federal court accused Balli of planning to export three 747s to Iran without a license, Middle East Newsline reported. Balli was said to have financed the purchase of the Boeing aircraft from an Iranian airline, which sought to use the 747s for foreign routes.

In 2008, officials said, Balli violated an order by the Commerce Department against exporting any item that required a license. Instead, the company continued negotiations to purchase and deliver U.S.-origin aircraft banned for export to Iran and other countries.

In all, Balli was fined $17 million, $15 million of which was part of a civil settlement with the Commerce Department and Treasury Department. Officials said this represented one of the largest fines for a U.S. export violation.

"Balli Aviation Ltd. and Balli Group PLC are denied export privileges for five years, although this penalty will be suspended provided that neither Balli Aviation nor Balli Group commits any export violations and pays the civil penalty," the Justice Department said.

In a statement released on Feb. 5 and sent to WorldTribune.com, Balli said:

"The settlement does not suggest that Balli Aviation sold, or intended to sell, these aircraft to Blue Airways or Mahan in breach of U.S. sanctions. Balli Aviation is a British company and there are no British or EU restrictions on commerce in civil aviation with Iran. This settlement ensures that Balli Aviation and all of its affiliates remain free to continue to trade in all U.S. goods and services."

Officials did not say whether the 747 was being operated by Iran for civilian or military purposes. The aircraft was capable of being converted into a platform for transport or airborne early-warning and alert.

"These charges reflect the commitment of the United States to vigorously enforce our laws against corporations that illegally seek to acquire U.S. aircraft from the U.S. on behalf of Iranian customers," Channing Phillips, acting U.S. Attorney for the District of Columbia, said.



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