Israel Denies Helping Ofer Brothers in Iran Dealings Case

The alleged business with Iran was done by the Singapore-based Tanker Pacific, one of the world's largest shipping companies and an Ofer Brothers subsidiary.

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The Israeli Foreign Ministry said yesterday it was not helping Ofer Brothers Group get get its name off the Americans' blacklist for alleged dealings with Iran, as the firm had led the media to believe.

On Tuesday the U.S. State Department shocked the Israeli business community with its announcement that the Ofer Brothers shipping company had violated economic sanctions against Iran. At the heart of the matter was an oil tanker named Raffles Park, which had been owned by the Ofer Brothers Group and eventually found its way into the hands of the Iranian national shipping company - the Islamic Republic of Iran Shipping Lines.

Sammy and Yuli Ofer from the Ofer Brothers Group. Credit: Archive

"The American decision relates to a private company, and the handling of the issue is between the company and the U.S. authorities," said a Foreign Ministry spokesman. The ministry is in contact with the U.S. authorities to receive more information on the case.

The Defense Ministry said it is not involved in any way in negotiating with the Americans; in any case, that's the fief of the Foreign Ministry, said the Defense Ministry.

As far as the Americans are concerned, such a sale supports the Iranian energy industry, whose profits are used in part to develop the Iranian nuclear program.

A state department spokesman, Mark Toner, replied to the Ofers' claims at a press conference on Wednesday.

"We did considerable due diligence in checking out these claims. And what we found is that Ofer Holdings Group is the parent of a company called Tanker Pacific, and that's the company that actually sold this tanker to the Iranians," Toner said.

Tanker Pacific did not reply by press time.

Toner said Tanker Pacific and its subsidiary had "failed to do proper due diligence and to prevent this transaction. So they're responsible - I guess my point is that they'd be responsible for the conduct of their subsidiary."

In addition, the oil tanker has a history with Iran, according to Equasis, a major shipping information database. The Raffles Park anchored a number of times in Iranian ports while it was owned by the Ofer brothers.

Equasis was founded when the European Commission and the French Maritime Administration decided to cooperate in developing an information system collating existing safety-related information on ships from both public and private sources and making it available on the Internet.

Equasis' data reveals that the ship visited Iran four times from September 2002 to January 2010 - but the current sanctions were not in place at the time. Nonetheless, Iran was - and still is - defined as an enemy country according to Israeli law, and trade by Israelis with Iran is forbidden.

The Foreign Ministry said it supports international efforts to apply effective economic pressure on Iran. The ministry has known of the investigation against the Ofer Brothers for some time, as has the company.

The alleged business with Iran was done by the Singapore-based Tanker Pacific, one of the world's largest shipping companies and an Ofer Brothers subsidiary. It operates a fleet of 45 huge tankers that transport crude oil worldwide, with branches in India, Britain and China.

Tanker Pacific bought Raffles Park in 2000. Until it was sold last September, the tanker carried crude oil under a Liberian flag. Liberia gives ships the right to use its flag to conceal their real ownership, as is customary in the shipping business, in exchange for foreign currency.

The tanker was sold for $8.65 million, a relatively low price, in a deal brokered by the Monaco-based company Shipping Brokerage Associated. This company, which declined to comment on the situation, located the company Coral Light Corporation of Panama, registered in Panama, which ended up under ownership of the company Crystal Shipping of Sharjah. This shipping company appears on the UN Security Council's blacklisted corporations. It is forbidden to trade with these corporations because of their involvement in transporting equipment and materials for Iran's missile and nuclear programs.

Sharjah is a small emirate in the Persian Gulf and is known for its connections with Iran, in particular with the Iranian Revolutionary Guards.

Crystal Shipping was the company that bought the Ofer Brothers' tanker. Another company, registered in Dubai, Noah Ship Management, provides managing services for the purchased tanker. Crystal is not on the blacklist. The ship's name was changed to Emma.

The U.S. State Department said on Tuesday that several companies involved in the deal served as a front to hide the fact that the Iranian national shipping company was behind it. This firm appears on the UN Security Council's roster of blacklisted companies. It is forbidden to trade with these companies because of their involvement in transporting equipment and materials for Iran's missile and nuclear programs.

While the investigation was underway, before the announcement was made, the Ofer Brothers Group tried to convince the Americans that it knew nothing of the sale by Crystal to the Iranians, but the Americans were not convinced.

It is possible the Americans have additional, secret information on the matter.

The company was given a semi-official hearing by the Americans in January, but the Ofers never informed the Israeli Foreign Ministry of the matter.



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