Mashhad’s Financial Emperor Laid to Rest

Ayatollah Abbas Vaez-Tabasi, representative for the city of Mashhad in Iran’s influential Assembly of Experts, died on the morning of March 4^th. He had suffered a pulmonary attack on February 26 — Election Day — and collapsed shortly after casting his vote for Parliament and the Assembly. He was 80. 

As the ayatollah lay dying at the Imam Reza Hospital in Mashhad, which is named after the holy city’s famous shrine, prominent political and religious figures visited his bedside. Vaez-Tabasi was known for his influence in Mashhad, and for his great wealth. 

Vaez-Tabasi had not registered as a candidate for the Assembly of Experts, the body that selects and theoretically supervises Supreme Leader Ayatollah Ali Khamenei. His absence on the list was significant because, after the 2014 death of Ayatollah Mahdavi Kani, the president of the Assembly, Vaez-Tabasi had been mentioned as a possible successor.

Since the Islamic Revolution of 1979, Vaez-Tabasi had run the huge religious endowment Astan Quds Razavi (AQR), which represents the supreme leader. 

The foundation was closely associated with the Shrine of Imam Reza, which honors the eighth Imam of Shia Islam. 

Politically, Vaez-Tabasi was close to former president Akbar Hashemi Rafsanjani. 

He was well known because of his efforts to quell political tensions in Mashhad following the appointment of Ahmad Elmolhoda, a staunch supporter of Ayatollah Khamenei, as Mashhad’s Friday prayer leader.

Vaez-Tabasi was one of the richest local figures in Iran. In an article published in on the website Iranian Focus, entitled “Iran’s rulers amass fortunes through sleaze,” his wealth was estimated to be around $770 million. If true, that would make him the sixth richest Iranian in the world.

With endowments in at least 12 Iranian provinces, AQR has been referred to as the biggest endowment in the world, estimated to be worth $15 billion. It is not only tax-exempt, but each year receives at least $14 million from the government in rent.

All of AQR’s commercial and business activities are conducted by Razavi Economic Institute, which was set up in 1998. It operates as an umbrella organization for 90 companies. None of them are accountable to any government agency, or to Parliament. The only authority that supervises them is the auditing department of the Supreme Leader’s office.

The companies under AQR’s umbrella are active in a vast array of sectors, from mining and construction material such as cement, to food, agriculture, pharmaceuticals, development and construction services, and the manufacture of automobiles and combines.

AQR is also a shareholder in a number of heavy industries, including the Mobarakeh Steel Company in Isfahan, in which it owns around 43 percent of shares. Some analysts estimate the value of lands owned by AQR at $20 billion.

Another unpatrolled source of income for AQR is the 20 million pilgrims who visit the Imam Reza shrine each year. While the high volume of pilgrims helps Mashhad’s economy, the real winner is AQR.

Corruption Cases Pile Up

With so much unsupervised money at stake, it should come as no surprise that corruption, or at least charges of corruption and related court cases, have not been far behind. One of the biggest cases was known as Al-Makaseb, named after a company that failed due to embezzlement. 

One defendant in the case was Nasser Vaez-Tabasi, son of the deceased ayatollah. He and other defendants were accused of embezzling about $48 million by selling the company’s shares. They claimed it was a private enterprise, even though 51 percent of it belonged to the Iranian government.

The case was opened in 2001, but after two years the judge exonerated Nasser and other defendants. The court’s verdict led to an outcry in the press.

In another case over fraudulent dealings in a film project, Mostafa Vaez-Tabasi, another son of the ayatollah, was a defendant.

The most recent scandal took place when Energy Minister Hamid Chitchian reported embezzlement of close to $400 million in the project to build Gorgan-Bojnord-Mashhad railway. The first defendant in this case was AQR which, according to Chitchian, intended to buy the contractor company for a fraction of its value. 

The government has not succeeded in its quest to bring the culprits in this case to justice. A number of MPs and members of the judiciary mobilized to act on the side of AQR, and according to an official in the energy ministry, the case was decided “in the highest echelons of the regime.” AQR got away unscathed.

Such was the power of Vaez-Tabasi’s empire. Now that he is gone, there is no doubt that many would claim his throne. One claimant could be Friday prayer leader, Ahmad Elmolhoda. Another could be Mahmoud Hashemi Shahroudi, a member of the Assembly of Experts, and the former chief justice of Iran. 

Vaez-Tabasi’s children are also waiting in line. They have inherited huge wealth that, needless to say, they can turn into power in the absence of their father.