Iranian Investigators Indicted Over Embezzlement of $21M in Crypto Assets

Senior officers of Iran’s Islamic Revolutionary Guard Corps (IRGC) are facing allegations of embezzling about $21 million in crypto while investigating defunct exchange Cryptoland and its CEO, Sina Estavi. 

The court documents identified Mehdi Hajipour and Mehdi Badi as the key figures behind the crypto thefts. The officers reportedly transferred tokens from the exchange’s seized assets into wallets they controlled. They then proceeded to sell the assets for personal profit under the guise of a corruption investigation. 

Sudden Wealth Raises Suspicion

According to the documents, Hajipour’s wallet alone processed over $21 million worth of BRG, the platform’s native token. Interestingly, the assets in his wallet were valued at approximately $40,000 before the scheme. Just four months later, his wealth had exploded to over $14.2 million (600 billion rials), raising suspicions. 

Hajipour spent his newly acquired wealth on gold, luxury real estate, and high-end vehicles. These luxurious purchases attracted the attention of authorities, prompting an investigation into the sudden and unexplained increase in his personal wealth, which became a crucial point in the case.

In March 2022, Hajipour was arrested in a sting operation after he was caught accepting a $10,000 bribe from Estavi, who mistakenly believed he was repurchasing stolen crypto from a third party. Unknown to Estavi, the identity was fabricated by Hajipour.

Alongside Hajipour and Badi, other senior interrogators from the IRGC Intelligence Organization were also involved in the embezzlement. The investigation identified Majid Jahan Parto and Majid Tabatabaei as well as four others who forged documents to legitimize the transactions. 

Cryptoland’s Downfall 

This case traces back to May 2021 when Cryptoland shut down following the arrest of its CEO, Estavi. He was accused of embezzling about $20 million resulting in over 51,000 complaints from investors in Iran.

In 2023, Estavi was sentenced to 15 years in prison, 75 lashes, fines, and a lifetime ban from public service. However, he managed to flee the country despite a travel ban that had been imposed on him. 

It is worth mentioning that half of the victims in this fraud case, who collectively lost $14 million, were repaid. The funds used for the repayments came from Estavi’s account while he was incarcerated, while the remaining victims are still awaiting compensation.