http://isis-online.org/ en paulbrannan@gmail.com Copyright 2010 2010-03-10T14:23:00+00:00 http://isis-online.org/conferences/detail/npt-review/http://isis-online.org/conferences/detail/npt-review/#When:17:15:37Z Welcome to the new ISIS webpage providing news and commentary on NPT Review Conference (RevCon) related events, issue areas, and country positions.  The 2010 NPT Review Conference, held every five years to review implementation of the Treaty, will take place in New York from May 3-28.   ISIS Analysis: RevCon News Analysis: a hard-line NAM position; a forward looking United States, March 11, 2010 A Review Conference for Rebuilding, March 4, 2010   Recent News: “Mideast Feels ‘Tricked’ by Nuclear Arms Treaty: Diplomat,” Agence France Presse, March 10, 2010. Analysis: “40 Years Later Nuclear Treaty in Shambles, Outlook Grim,” Xinhua News Agency, March 6, 2010. “US Plans ‘Dramatic Reductions’ in Nuclear Weapons,” BBC News, March 2, 2010. “ICNND Chief Sees 2010 as “Watershed” for Nuclear Non-proliferation, Disarmament,” Xinhua News Agency, March 2, 2010. “Is Russia Stalling START?” Politico, March 2, 2010. “Obama Team Might Speed Up Disassembly of Older Nuclear Warheads,” Global Security Newswire, March 1, 2010. “Barack Obama Orders a New Nuclear Review Amid Growing Fued,” The Guardian, February 28, 2010. “Okada Says Japan Willing to Host Nuclear Disarmament Conference Later this Year,” Mainichi Daily News, February 24, 2010. “Pakistan Rules Out Joining Nonproliferation Treaty,” Global Security Newswire, February 23, 2010. “South Africa’s Help Sought Ahead of NPT Review Conference,” Global Security Newswire, February 23, 2010. “Gaps Remain Ahead of NPT Review Conference: Next President of NPT Meeting,” Kyodo News, February 2, 2010. “2010 to be Key Year in Fight Against Nuclear Arms,” Reuters, December 22, 2009.   Remarks by officials: Statement by President Obama on the 40th Anniversary of the Nuclear Nonproliferation Treaty, March 5, 2010. Secretary-General [Ban Ki-Moon] Pledges to Continue His Disarmament Efforts, in Statement on Fortieth Anniversary of Nuclear Non-Proliferation Treaty, March 5, 2010. “Taking Stock of the NPT: An Interview With U.S. Special Representative Susan Burk,” Arms Control Today, March 2010. Joint Statement by Minister of Foreign Affairs of Japan and Minister for Foreign Affairs of Australia, “Towards a World without Nuclear Weapons,” February 21, 2010 Speech by U.S. President Barack Obama at the UN Summit on Nuclear Non-Proliferation and Nuclear Disarmament, and Summaries of Remarks by Heads of State, September 24, 2009.   Past Review Conference documents: Final Document of the 2000 NPT Review Conference The “13 Steps” or Promises of the 2000 NPT Review Conference 1995 NPT Review Conference Package of Decisions   Important diplomatic documents: Report of the International Commission on Nuclear Non-Proliferation and Disarmament, “Eliminating Nuclear Threats: A Practical Agenda for Global Policymakers,” December 2009. United Nations General Assembly, First Committee resolution on General and Complete Disarmament: Renewed Determination towards the total elimination of nuclear weapons,” October 15, 2009. United Nations Security Council Resolution 1887, September 24, 2009.   Relevant RevCon website and report links: UN Office for Disarmament Affairs NPT Review Conference website Reaching Critical Will Review Conference page The Acronym Institute’s Review Conference page The International Atomic Energy Agency’s “Preparing for 2010” website December 14-18, 2010 Wilton Park Conference summary, “Nuclear Non-Proliferation and the NPT Review” Carnegie Endowment for International Peace report, “Restoring the NPT: Essential Steps for 2010,” November 2009.   Non Proliferation 2010-03-11T17:15:37+00:00 http://isis-online.org/isis-reports/detail/washington-post-article-featuring-isis-book-peddling-peril/http://isis-online.org/isis-reports/detail/washington-post-article-featuring-isis-book-peddling-peril/#When:14:23:00Z An article in the Washington Post today featured ISIS’ upcoming book Peddling Peril about illicit nuclear trade.  The book, published by Free Press, is scheduled for release March 16. From Peddling Peril by David Albright: “With the global spread of technology and rapid growth in international trade, smugglers find it easier to ply their dangerous trade. It’s simpler now to obtain the materials, equipment, and know-how to produce nuclear weapons than it was ten years ago, and could be simpler still ten years from now… Over the next several years, many states in dangerous regions of the world, along with terrorist organizations, are expected to pursue nuclear weapons. Governments’ ability to detect and stop this perilous trade remains limited. Too often, major successes in thwarting nuclear proliferation have depended on the last line of defense—military attacks, intelligence operations, and cargo seizures. As important as these measures are, it is risky to depend on the last line of defense for our security. A former CIA official who was instrumental in busting the Khan network worries, “Can we count on intelligence when we need it again?” Finding new ways to thwart these efforts is critical.” Any royalties from the sale of this book go to ISIS. Illicit Trade 2010-03-10T14:23:00+00:00 http://isis-online.org/isis-reports/detail/supplement-to-irans-gas-centrifuge-program-taking-stock/http://isis-online.org/isis-reports/detail/supplement-to-irans-gas-centrifuge-program-taking-stock/#When:14:26:33Z On February 11, ISIS published a report examining the status of Iran’s gas centrifuge program at the Natanz Fuel Enrichment Plant (FEP).  The safeguards report of the International Atomic Energy Agency (IAEA) released on February 18, 2009 contains additional information about the performance of centrifuges at Natanz. 1  This supplement to the ISIS report of February 11 discusses the new information, updates several of the figures and tables in the primary report, and expands upon a number of the findings of the original report in light of the new information.  For more information about the data and analysis underlying this supplement, please see the original report. The data in the latest IAEA safeguards report further support a central finding of the original ISIS report, namely that Iran is unlikely to deploy enough gas centrifuges to make enriched uranium for commercial nuclear power reactors for a long time, if ever.  As such, one of the most striking lessons from reviewing Iran’s accomplishments at Natanz is just how unachievable a commercial enrichment program remains, while at the same time, how comparatively little enrichment capability is required for a nuclear weapons capability.  After including declines in the number of P1 (IR-1) centrifuge cascades at Natanz, the FEP had 6,724 P1 centrifuges in 41 cascades being fed uranium hexafluoride or installed and ready to accept uranium hexafluoride.  Iran has the ability to deploy many thousands more centrifuges at Natanz or another facility.  Iran is unlikely to face significant delays in making weapon-grade uranium at Natanz if it decides to build nuclear weapons.  Starting with natural uranium, Iran could produce enough weapon-grade uranium for a nuclear weapon in a year, although it may need more centrifuges to do so than predicted in earlier ISIS estimates. In a breakout scenario using low enriched uranium, Natanz could currently produce enough weapon-grade uranium for a weapon in six months or less.  In this light, Iran’s recent decision to start producing 19.75 percent low enriched uranium (LEU) in the pilot plant from 3.5 percent LEU, ostensibly for civil purposes, is particularly troubling.  If Iran succeeds in producing a large stock of 19.75 percent LEU, in a worst-case scenario, the FEP is large enough to turn this LEU into sufficient weapon-grade uranium for a weapon within a month.  Its production could even occur between visits by IAEA inspectors, a time period that Iran could easily lengthen by positing some emergency or accident that requires a delay in permitting the inspectors inside the plant.  Although the IAEA would later discover what happened, Iran may have only marginally violated its IAEA safeguards commitments by producing this weapon-grade uranium (Iran’s production of weapon-grade uranium by itself is not a safeguards violation, although its continued enrichment already violates several UN Security Council resolutions).  Yet, it would have successfully used the FEP to secretly emerge with enough nuclear explosive material for a nuclear weapon.  This worst-case assessment depends on Iran accumulating sufficient 19.75 percent LEU, an achievement not likely in 2010 but increasing in likelihood in 2011 and 2012.  Although the most important goal is achieving a suspension of Iran’s gas centrifuge program as called for in multiple IAEA and U.N. Security Council resolutions, it is also vital to improve the safeguards at Natanz and drastically reduce Iran’s stocks of LEU.  The original ISIS report concluded that the Fordow enrichment plant is capable of producing enough weapon-grade uranium for a weapon under conservative assumptions about the performance of the P1 centrifuges. Information in the recent IAEA report has strengthened this conclusion.  This result confirms the Obama administration’s estimate that Fordow is large enough to produce enriched uranium for a weapons program.  However, the discovery of Fordow eliminates its usefulness in producing weapon-grade uranium in a parallel secret program starting with uranium hexafluoride made outside of safeguards.  Its potential role in a breakout strategy using 3.5 percent LEU is also diminished, since Iran is likely to want a secret site if it pursues nuclear weapons. A major unknown is how much dedicated enrichment capacity Iran has established in secret outside Natanz and Fordow.  Available, albeit limited, evidence about clandestine activities, the discovery of the incomplete Fordow site, and the struggles Iran is encountering with cascades at Natanz would suggest that Iran has not completed a centrifuge facility operating with a nuclear-weapons significant number of P1 centrifuges.  However, it may well be building one now.  Thus, in 2010 Iran may be limited in its ability to produce weapon-grade uranium outside of the Natanz site, either in a breakout mode using its existing stock of LEU or in a parallel effort starting with natural uranium. Number of Centrifuges at the Fuel Enrichment Plant The number of centrifuges installed and being fed with uranium hexafluoride decreased in the last few months to a total of 6,724 centrifuges.  As of January 29, 2010, the number of centrifuges being fed uranium hexafluoride fell to 3,772 P1 centrifuges from 3,936, a decrease of one cascade, or from 18 to 17 cascades.  In addition, a total of 2,952 P1 centrifuges were under vacuum or installed and thus ready to accept uranium hexafluoride.  Figure 1 summarizes the number of centrifuges at the FEP since 2007. In a new development reported in the IAEA safeguards report, Iran disconnected a number of centrifuges in 11 cascades in the A26 module.  (These 1,804 centrifuges are not included in the total above.)  This module is the one that experienced decreases in the number of cascades being fed uranium hexafluoride in 2009.  In addition, centrifuges in two cascades in the A28 module, which had not yet been fed any uranium hexafluoride, were removed or were in the process of being removed.  The IAEA report is silent on the reason for these decisions; and Iran is not obliged to explain its rationale to the IAEA.  But this action could imply that these cascades did experience significant problems, as discussed in the original ISIS report.  Alternatively, Iran could be in the process of moving at least some of these centrifuges elsewhere. The IAEA report implies, and senior officials close to the IAEA reiterate, that Iran does not appear currently focused on increasing the total number of centrifuges at the FEP.  It may be dealing with unexpected problems in its cascades or shifting its priority to finishing the Fordow facility and other unknown enrichment sites. LEU Output In the most recent reporting period, Iran estimated a greater output of LEU.  From November 23, 2009 to January 29, 2010, Iran’s production of LEU increased to an average rate of 117 kilograms of LEU hexafluoride per month from 86 kilograms per month in the previous reporting period – despite one fewer cascade enriching (see Figure 2).  In total, during this recent period, Iran estimated it produced a total of 257 kilograms of LEU hexafluoride, bringing its total LEU stock to 2,065 kilograms. 2 This LEU is in the product tanks or in cold traps associated with those product tanks, but it does not include the amount of slightly enriched uranium in dump tanks, which are on the product side of the cascades and receive material not desired in the product tanks, as described in the February ISIS report.  This quantity includes about 1,000 kilograms of slightly enriched uranium (one percent or slightly higher).  It is mostly recoverable and available for further enrichment. The recent period witnessed an increase in the average amount of uranium hexafluoride introduced into the cascades.  Figure 3 plots the historical average amount of feed entering the cascades.  Figure 4 compares the monthly average amount of feed and LEU to the midpoint of the number of cascades operating in the reporting period.  As can be seen, the feed and the LEU output are in line and increasing, which implies better performance during the most recent period.  Figure 5 shows the average estimated annualized separative capacity during the recent reporting period compared to earlier reporting.  Based on the Iranian LEU estimate, the annualized separative capacity has reached about 3,400 swu per year, compared to about 2,500 swu per year during earlier periods.  Assuming all 3,772 P1 centrifuges are operating, then each machine is achieving an average of 0.9 swu per year (see also table 1).  As noted in the original report, this average value is likely an underestimate because some of these centrifuges are not operating.  The average in the last reporting period was about 0.6 swu per year per P1 centrifuge.  This increase demonstrates that the average separative capacity of centrifuges in the FEP is not fixed and can be expected to improve as Iran gains more experience in cascade operations. The FEP appears to be operating better than in 2009.  If the Iranian LEU estimate is accurate, Iran seems to have managed to reach a new high in average LEU production.  But an increase in LEU output in only one reporting period does not necessarily mean that FEP’s enrichment performance has significantly improved, particularly with so many centrifuges being inexplicably disconnected at the FEP.  Data from future reporting periods will ultimately settle this question. A New Scenario: Secret Weapon-Grade Uranium Production at FEP Iran could use the cascades at the FEP to produce weapon-grade uranium by step-wise increasing the enrichment level to weapon-grade uranium, as described here.  Thus, if Iran wants to produce weapon-grade uranium, it would have an interest in producing 19.75 percent LEU from 3.5 percent LEU, which is the second of four steps to weapon-grade.  The next two steps would go from 19.75 to 60 percent enriched, followed by one from 60 to 90 percent enriched, where 90 percent enriched is weapon-grade uranium.  Each step requires significantly less enrichment effort or time to complete the step.  For example, once Iran has reached 19.75 percent LEU, it is 90 percent of the way in terms of enrichment output (separative work) to weapon-grade uranium.  If Iran started with natural uranium and used all 3,772 centrifuges operating at the level of 3,400 swu per year, it could make about 22 kilograms of weapon-grade uranium a year, assuming a tails assay of 0.5 percent.  If 3.5 percent LEU were used, these centrifuges could make 105-130 kilograms of weapon-grade uranium per year, where the tails assays are taken as 1.0 and 1.7 percent, respectively.  If 19.75 percent LEU were used as feed, these centrifuges could produce 350-680 kilograms of weapon-grade uranium per year, where the tails assays are 1 and 10 percent, respectively. The over-riding constraint on the last two estimates is the availability of feed material.  As can be seen above, the choice of a higher tails assay can significantly increase the rate of weapon-grade uranium production, but that increase comes at the cost of the need for significantly more feed material.  Iran does not have enough LEU to maintain these rates.  Iran currently possesses slightly more than 2,000 kilograms of 3.5 percent LEU and only hundreds of grams of 19.75 percent LEU.  The former is sufficient to make enough weapon-grade uranium for one to two nuclear weapons under the above scenarios.  But these calculations show how fast Iran could produce enough weapon-grade for one nuclear weapon if it accumulates sufficient LEU stocks—several months with 3.5 percent LEU versus a month or less with 19.75 percent LEU.  These last calculations show just how close Iran would be to having enough weapon-grade uranium for a weapon if it develops a significant stock of 19.75 percent material.  Iran could make this weapon-grade uranium from this material at Natanz in-between visits by IAEA inspectors, who are not continuously at the Natanz site.  It could also rapidly remove this weapon-grade uranium to protect it from military strikes.  These calculations currently involve a worst-case scenario.  They assume Iran has enough 19.75 percent LEU and has minimized the time to modify its centrifuge operations and start making weapon-grade uranium.  This situation becomes more realistic as Iran improves and expands its capabilities and increases its stock of LEU.  In approximately one to two years, Iran would have a greater chance of successfully carrying out this strategy of rapidly producing weapon-grade uranium from 19.75 percent LEU at Natanz. This strategy is different from a traditional breakout strategy, where Iran removes the LEU from safeguards and moves it to a secret site for further enrichment.  In that case, it may use fewer centrifuges, say 500-1,000 P1 centrifuges, and produce the material in less than six months.  The longer time frame of six months in the case of 19.75 percent LEU feed assumes that Iran would have produced less of this LEU and would therefore be forced to use a relatively low tails assay to conserve material and additionally would encounter reliability or performance problems in its centrifuges.  A disadvantage of this approach is that Iran would have to reveal its intentions to build nuclear weapons before it has weapon-grade uranium, since the IAEA would see the diversion of the LEU.  An advantage is that the production of weapon-grade uranium would occur at a site Iran works to conceal from military strikes, whether through aerial bombardment or commando ground strikes.  As mentioned in a previous ISIS report, building and maintaining the secrecy of a 500-1000 centrifuge plant would be relatively easier than doing the same for a 3,000 centrifuge plant, like Fordow.  In addition, this clandestine site could continue to produce weapon-grade uranium for additional nuclear weapons.  Thus, if Iran seeks a nuclear weapons arsenal, it would likely want secret centrifuge sites in any case.  But it might want to invoke a strategy of rapidly producing weapon-grade uranium at Natanz, or for that matter at Fordow, while maintaining safeguards as long as possible in order to maximize speed and reduce the effectiveness of any military strikes. 2009 PIV: Iranian LEU Estimates Accurate in 2009 In its most recent safeguards report, the IAEA released part of its results gathered in its 2009 Physical Inventory Verification (PIV) at the FEP (see Table 2).  By subtracting the values from the 2008 PIV, the result is the amount of material added in the period from November 23, 2009 to January 29, 2010.  Small amounts of LEU may have been sent elsewhere, but these quantities are ignored here. From November 23, 2008 to November 22, 2009, Iran produced approximately 969 kilograms of 3.5 percent enriched uranium (seeTable 3).  This is higher than a comparable Iranian LEU estimate, namely 924 kilograms of LEU for roughly the same period.  The two values are close, differing by 45 kilograms or less than 5 percent of the total.  However, Table 2 shows that the time periods do not exactly overlap, with the PIV period being about two weeks longer than the period for the Iranian estimates.  During this two-week period, the Iranian LEU value would likely have increased by about 40 kilograms, based on earlier LEU production of about 85 kilograms per month (see Figure 2).  Nonetheless, the difference between the two values is relatively small, even if one ignores the additional LEU produced during this two-week period.  As a result, ISIS did not correct the values in the other tables and figures for the periods covered by the 2009 PIV, as ISIS did for 2008 values.  In that year, the difference was significantly larger due to an error in the Iranian calculations of LEU production. Some may claim incorrectly that the most accurate estimate of LEU production is the IAEA measurement of the amount of LEU off-loaded into product cylinders, or 814 kg (see table 2).  The IAEA takes these measurement in-between PIVs.  The measurements do not include the LEU in the cold traps.  Despite being underestimates of total LEU production, these measurements help the IAEA achieve their safeguards objectives at the FEP.  The 2009 PIV measurement for the LEU is 155 kilograms greater than the combined IAEA measurements of the amount of LEU off-loaded into product cylinders.  The periods again do not overlap, so the difference would be less if the periods were identical.  In 2009, the PIV shows that the Iranian estimates of LEU production were more accurate than the IAEA measurements of LEU off-loaded into cylinders.  It is worth noting that the amount of natural uranium, or feed, measured in between the PIVs is accurate because it represents all the uranium introduced into the centrifuge modules. Observations and Additional Findings Iran’s centrifuge program is still in development.  It is unrealistic to expect its program to remain static – an enrichment program is intrinsically based on improving the separative capacity of its centrifuges. In the most recent reporting period, the FEP has fewer centrifuges being fed uranium hexafluoride but is producing more LEU in these fewer cascades.  The overall separative capacity of the centrifuges being fed uranium hexafluoride has increased. The IAEA does not know why Iran is disconnecting centrifuges in the A26 module.  Is it fixing or renovating them, or is it moving them to another site?  The same is true for cascades in the A28 module. Iran is likely to continue concentrating on improving its LEU output at Natanz, developing more advanced centrifuges, building the Fordow enrichment plant, and constructing additional enrichment plants.  Iran is expected to continue seeking equipment, materials, and technology abroad for its centrifuge effort.  Disrupting these efforts through increased vigilance on stopping illicit trade of dual-use goods can delay its centrifuge program and prevent the transfer of knowledge that could help Iran solve its problems in building and deploying not only the P1 centrifuge but more advanced ones as well. In the end, Iran is capable of solving its immediate centrifuge problems either by improving the output of the P1 centrifuge or building more of them, or both.  In the medium term, it can also deploy more advanced centrifuges.  But as long as Iran is under international sanctions, it is likely to face problems in expanding its centrifuge operations to provide sufficient LEU to fuel a commercial nuclear power reactor.  Iran’s goal of a large domestic enrichment capability is driven in part by a fear of foreign suppliers cutting off LEU fuel for its nuclear power reactors.  However, these very sanctions, worsened by Iran’s lack of cooperation with the IAEA, are making it impossible for Iran to create that enrichment capability.  While it struggles with its commercial goals, Iran is strengthening an enrichment capability able to produce weapon-grade uranium for nuclear weapons.  The number of ways it can do so is also increasing.  If Iran develops a stock of 19.75 percent LEU, it could even use Natanz’s FEP to quickly produce weapon-grade uranium before the international community could respond.  Unless IAEA safeguards inspectors are stationed at the FEP far more frequently, the international community may not learn about the weapon-grade uranium production until it already had left the site.     Figure 1: P1 centrifuges at the Natanz Fuel Enrichment Plant Figure 2: Monthly average LEU production at Natanz Fuel Enrichment Plant during each IAEA reporting period, bar at midpoint of reporting period Figure 3: Average monthly rate of introducing natural uranium hexafluoride into Natanz Fuel Enrichment Plant during each IAEA reporting period, bar at mid-point of reporting period Figure 4: Comparison of Feed, LEU Product, and midpoint of number of cascades in each IAEA reporting period, point at midpoint of reporting period Figure 5: Anualized separative capacity in the Natanz Fuel Enrichment Plant during each IAEA reporting period, excluding slightly enriched uranium in the dump tanks, bar at midpoint of reporting period     1 Report by the Director General, IAEA, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran, GOV/2010/10, February 18, 2010. 2 For the period November 23, 2009 to January 29, 2010, the IAEA measured the mass of LEU in feed and product cylinders.  For this period, the amount fed into the cascades was 2,516 kilograms and the product cylinders held 159 kilograms of LEU hexafluoride.  This LEU measurement is expected to be lower than the Iranian estimate of 257 kilograms LEU hexafluoride because the IAEA measurement does not include LEU in cold traps, which had been emptied as part of the November 2009 physical inventory verification and would be refilled as enrichment restarted.  The difference of 98 kilograms between the Iranian total production estimate and the amount measured in the product cylinder is consistent with this explanation but appears on the high side of expectations based on similar data in 2009. Iran 2010-03-03T14:26:33+00:00 http://isis-online.org/isis-reports/detail/latest-collaborations-of-isis-and-the-media-on-illicit-trade-cases/http://isis-online.org/isis-reports/detail/latest-collaborations-of-isis-and-the-media-on-illicit-trade-cases/#When:17:29:07Z ISIS would like to draw attention to some illicit trade cases involving Iran and North Korea that ISIS has worked on recently with the Associated Press, Kyodo News and 60 Minutes. AP Enterprise: How Nuclear Equipment Reached Iran Peter Enav and Debby Wu, The Associated Press February 28, 2010 http://www.nytimes.com/aponline/2010/02/28/world/AP-AS-Taiwan-Iran-Nuclear.html N. Korea provided raw uranium to Syria in 2007: sources Tomataro Inoue, Kyodo News February 28, 2010 http://mdn.mainichi.jp/mdnnews/international/news/20100228p2g00m0in001000c.html How Iran Obtains U.S. Technology 60 Minutes, CBS News February 14, 2010 http://www.cbsnews.com/stories/2010/02/11/60minutes/main6198599.shtml Illicit Trade 2010-03-01T17:29:07+00:00 http://isis-online.org/isis-reports/detail/iaea-report-on-iran-enrichment-at-natanz-improving-entire-leu-tank-moved-to/http://isis-online.org/isis-reports/detail/iaea-report-on-iran-enrichment-at-natanz-improving-entire-leu-tank-moved-to/#When:18:38:50Z Iran 2010-02-18T18:38:50+00:00 http://isis-online.org/iaea-reports/detail/implementation-of-the-npt-safeguards-agreement-in-the-islamic-republic-of-i/http://isis-online.org/iaea-reports/detail/implementation-of-the-npt-safeguards-agreement-in-the-islamic-republic-of-i/#When:16:44:51Z Iran 2010-02-18T16:44:51+00:00 http://isis-online.org/iaea-reports/detail/implementation-of-the-npt-safeguards-agreement-in-the-syrian-arab-republic3/http://isis-online.org/iaea-reports/detail/implementation-of-the-npt-safeguards-agreement-in-the-syrian-arab-republic3/#When:16:44:03Z Syria 2010-02-18T16:44:03+00:00 http://isis-online.org/isis-reports/detail/french-court-delays-decision-over-extradition-of-majid-kakavand/http://isis-online.org/isis-reports/detail/french-court-delays-decision-over-extradition-of-majid-kakavand/#When:19:13:01Z A French appeals court decided February 17 to delay a decision over the question of extraditing Majid Kakavand, an Iranian citizen, to the United States to stand trial on charges of exporting U.S. electronic goods to Iran.  Kakavand is charged in the United States with fifteen counts of conspiracy, smuggling, money laundering, fraud, and making false statements.  Kakavand allegedly deceived U.S. companies into selling goods to his Malaysian company, Evertop Services, which U.S. authorities allege was a front company used to divert goods to Iran.  His alleged customers in Iran included entities named on U.S. sanctions lists because of their involvement in procuring goods for Iran’s ballistic missile and nuclear programs, Iran Electronics Industry (IEI) and Iran Communications Industries (ICI).  Kakavand was arrested while on vacation nearly one year ago in Paris pursuant to a U.S. arrest request.  The French court deciding the extradition matter has delayed its decision now on six occasions due to the sensitivity of the matter.  The judge delayed the decision this time in order to obtain technical opinions about the case from the French Ministry of Defense.  He reportedly seeks more information about the potential uses of the goods allegedly exported by Kakavand, including whether they are dual-use items with military applications.  Kakavand is out on bail and living in Paris pending a final decision over his case.  To learn more about the case of this alleged smuggler, click here to read the ISIS case study on Majid Kakavand.  The U.S. criminal complaint can be accessed here.  To read more about the recent efforts of the United States to arrest and prosecute alleged Iranian smugglers abroad, read the ISIS capstone piece, “Busting the Members at the Core of Iran’s Smuggling Networks for Nuclear, Missile, and Conventional Military Goods,” and four case studies on alleged Iranian smugglers: Capstone: Busting the Members at the Core of Iran’s Smuggling Networks for Nuclear, Missile, and Conventional Military Goods by David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Four Supporting Case Studies: Inventive U.S. Sting Operation Catches Iran-Based Military Equipment Smuggler David Albright, Paul Brannan and Andrea Scheel Stricker February 16, 2010 Former Iranian Ambassador Arrested in Britain for Allegedly Assisting Iran-Directed Smuggling Scheme David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Middleman Majid Kakavand Arrested for Allegedly Directing Malaysia-Based Iranian Illicit Procurement Scheme David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Arrest Made in Germany of Core Iranian Procurement Agent David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Iran, Illicit Trade 2010-02-17T19:13:01+00:00 http://isis-online.org/isis-reports/detail/busting-the-members-at-the-core-of-irans-smuggling-networks/http://isis-online.org/isis-reports/detail/busting-the-members-at-the-core-of-irans-smuggling-networks/#When:16:06:37Z The Iranian regime often acts as though it has a right to smuggle goods from abroad for its nuclear, missile, and conventional weapons programs.  Now that supplier states are increasingly seeking the arrest of its agents, Iran is issuing threats.  Key supplier countries, such as Britain, Germany, Japan, and the United States, have often arrested non-Iranian suppliers and middlemen for illegal exports to Iranian nuclear and military entities.  But the Iranians who organize these purchases have often evaded arrest.  They act as if they believe themselves above other nations’ laws and safely ensconced in Iran.  What has changed is that the United States now aggressively seeks to arrest those smugglers as well.  This approach supplements the imposition of United Nations Security Council sanctions on Iranian government entities and officials who lead these military and nuclear projects and create the smuggling operations.  U.N. Security Council sanctions have resulted from Iran’s refusal to heed calls to suspend its uranium enrichment program and cooperate adequately with the International Atomic Energy Agency.  These actions are complementary.  The sanctions block financial assets and the travel of key Iranians.  The arrest of Iranians directly tied to smuggling can harm Iranian procurement networks and deter others from pursuing these careers.  Adding these smugglers to the U.N. sanctions list could disrupt their operations—unlike many Iranians on the list, these individuals do need to travel and use the international financial system to conduct their business. Smuggling Networks Iran is heavily dependent on foreign supply to outfit its nuclear, missile, and conventional military programs.  Over three decades, Iran has become quite experienced at smuggling.  Disrupting Iran’s extensive international smuggling operations requires concerted international cooperation.  Creating overseas shopping lists is the responsibility of procurement organizations within state entities, such as the Defense Industries Organization (DIO), Aerospace Industries Organization, Aircraft Industries Group, Iran Electronics Industries, and the Atomic Energy Organization of Iran.  These entities are not likely to procure goods directly from foreign suppliers.  Seasoned in exploiting loopholes in national and international trade control laws, Iran’s procurement organizations have created networks of domestic and foreign trading companies and agents that seek the necessary goods from abroad.  Iran relies on a range of Iranian middlemen and companies to fill orders from state entities.  Often, however, with increased awareness and stronger export controls, these Iranian companies have little chance of getting sensitive goods from Western suppliers, still the main target for high-technology items.  These individuals and companies seek out foreign middlemen, often trading companies, that will approach foreign suppliers.  There may be several successive middlemen abroad handling a single procurement—further obscuring from suppliers the actual person or organization behind the procurement.  Sometimes, the trading companies know the true end use of the goods; oftentimes, they do not.  But most are willing to certify to suppliers that the end user is civilian and an item is not intended for Iran.  Dubai, Malaysia, or China are conveniently claimed as the final destinations.  Rarely does a supplier have the means to check this claim.  As economic sanctions on Iran have increased and as Iran has created more sophisticated procurement operations, suppliers typically see only these foreign middlemen and a promise that countries like Iran will not receive any goods.  It is the foreign middlemen that typically make the purchases, take most of the risks, and serve to shield the inner, Iran-based core from discovery or prosecution.  There have been many arrests of these outlying network operatives, and despite how valuable they are in supplying Iran’s nuclear, missile, and conventional military programs, Iran has often viewed these operatives as expendable. 1 A challenge for countries targeted by Iran is to bring to justice members in the core of these networks, namely those based in Iran at government entities, and Iranians directly connected to these entities at domestic companies.  To overcome this challenge, the United States has targeted Iranians at the center of Iran’s state-directed smuggling operations, particularly those seeking U.S. sensitive military or dual-use equipment.  For too long, these Iranians have believed that they are somehow immune from arrest and prosecution overseas for breaking the laws of other countries.  But to run their operations, these agents periodically leave Iran, at which point they are vulnerable to arrest. Holding the Inner Core Responsible In the last several years, U.S. enforcement agencies working with foreign partners have arrested a range of Iranian smugglers and sought to prosecute them in the United States or abroad.  Obtaining extradition and conviction of these smugglers can send a strong signal to Iran about the risks of continuing to run smuggling operations.  The outcomes of these cases, however, have not always been successful or are still pending.  In some cases, Iranian smugglers arrested abroad have ultimately been released by authorities of those countries, allowing them to return to Iran where they are protected from further foreign prosecution. ISIS has identified six cases occurring over the last several years in which U.S. actions led to the arrest of Iranians alleged to be in the regime’s smuggling core, including former or current members of the Iranian regime involved in smuggling operations.  Iran has increasingly sought their release.  In addition, Iran has tried to barter the release of Americans and other nations’ citizens it has seized for the release of these individuals engaged in or allegedly engaged in illicit trade, including illegal nuclear trade. 2 1) In May 2008, Iranian citizen Amir Hossein Ardebili pleaded guilty in the United States to charges of buying arms equipment for the Iranian Ministry of Defense, including goods usable in Iranian attack aircraft, missiles, and missile guidance and target acquisition systems.  He was described as a low-level but prolific smuggler, garnering around $1 million per year in U.S. military equipment. 3  In 2007, a U.S. sting operation lured him from Iran to Tbilisi, Georgia, where he was arrested and extradited to the United States.  He was sentenced to five years in prison. 4 2) In March 2009, Majid Kakavand, who may have worked as an employee of an oil company in Iran, was arrested in France for allegedly directing a procurement network that sent at least 30 shipments of U.S. electronic equipment usable in military, avionic, and aerospace programs to a freight forwarder in Malaysia, which then re-exported the goods to Iran.  Kakavand allegedly operated phony front companies and offices in Malaysia, Singapore, and Iran specifically to procure items ($1,187,212 worth of U.S. items in less than two years) for state entities that supplied the Iranian Ministry of Defense Armed Forces and Logistics section, Iran Electronics Industry (IEI) and Iran Communications Industries (ICI).  Both IEI and ICI are well known as procurers for Iran’s military industries.  A French court decision over Kakavand’s extradition to the United States for trial is slated for mid-February 2009. 5 3) In March 2009, U.S. authorities arrested Hossein Ali Khoshnevisrad, an Iranian national, during a layover at a U.S. airport for allegedly buying U.S. military aircraft parts illicitly through his Iranian trading company, Ariasa, and an Irish trading company Mac Aviation Group, on behalf of Iran’s Aircraft Manufacturing Industrial Company (HESA) and Iran Aircraft Industries (IACI).  Khoshnevisrad apparently has been arraigned but not yet tried. 6 4) In October 2006, British authorities arrested former Iranian ambassador to Jordan, Nosratollah Tajik, at the request of the U.S. government for allegedly assisting in brokering the purchase of U.S.-made military night vision systems for Iran.  Tajik allegedly attempted to purchase items from U.S. undercover agents through his British company, and have them sent to Britain or Dubai where they would be diverted to Iran.  Tajik allegedly worked with an Iranian employed with the Industrial Automation Group (IAG), located in Iran and working on behalf of Iranian military entities.  Britain authorized Tajik’s extradition to the United States to stand trial, but Tajik is fighting extradition based on claims of poor health. 7 5) In January 2010, German authorities arrested Amirhossein Sairafi, an alleged Dubai and Iran-based middleman who transshipped vacuum equipment believed to be for nuclear gas centrifuge plants in Iran.  Sairafi allegedly managed a front company out of Dubai and Iran called AVAC to receive U.S.-origin items from a middleman stationed in California.  In addition to operating AVAC, Sairafi may have worked as the CEO and director of a company located in Tehran called Command Co., Ltd, a general trading company.  He also ordered equipment directly without the use of a foreign middleman.  Sairafi’s extradition to the United States to stand trial has not yet been decided. 8 6) In September 2008, Jamshid Ghassemi, a high ranking Iranian air force officer, was arrested in a U.S. sting operation in Thailand for allegedly trying to buy missile guidance systems. A Thai court ordered Ghassemi released after the Iranian government claimed to the Thai government that he was entrapped by U.S. government agents and the United States would torture him to obtain secrets about the Iranian military. 9 Iran has publicly defended its Iranian smuggling operatives and has used diplomatic channels to attempt to secure their release.  Iran claims that the recent U.S. crackdown and arrests are occurring for political reasons and that the United States and its partners are seeking to pressure Iran over matters unrelated to the cases, such as its nuclear program.  Iran’s foreign ministry has publicly demanded the release of suspected smugglers, even claiming that guilty pleas are signs of mental instability. 10  Iran has apparently retaliated and insinuated that the detainment of British, French, and U.S. prisoners on charges of spying or fomenting political dissent in Iran is linked to arrests of smuggling suspects. 11  It may be seeking to leverage prisoner exchanges by increasing the rate with which it detains foreigners, which it appears to do with little or no basis. Lessons and Observations The United States has been willing to exert exceptionally creative means abroad to thwart Iran’s illicit procurement operations; other countries should more aggressively join in these efforts.  U.S. authorities have painstakingly built their cases against these Iranians, posing as arms salespeople in many cases, and obtained their arrest. These cases show that good cooperation between the United States and its foreign partners can lead to the arrests and extradition of smuggling suspects.  Extradition in these cases, however, is by no means guaranteed.  Moreover, extradition remains uncertain for Western prosecutors seeking the arrest of transnational smugglers based outside Iran who are theoretically more vulnerable to prosecution.  In several recent cases, the United States has been unsuccessful in obtaining extradition of Irish aircraft part brokers from Mac Aviation Group, alleged Chinese smuggler and money launderer Li Fang Wei, and the major players implicated in the Mayrow procurement network based in Malaysia and Dubai. 12  The reasons for failing to obtain extradition vary, from lack of an extradition treaty in some cases to inadequate coverage of the modern crime of arms trafficking in extradition treaties.  In the case of China, the government has also shown little willingness to cooperate. Iran is expected to continue taking action to defend its procurement agents when they are arrested in the course of their smuggling operations.  As seen in the case of Ghassemi in Thailand, judicial systems are vulnerable to Iran’s claims and defense of its smugglers.  Iran acts as if violations of other countries’ laws are somehow justified, typically claiming that the actions are not illegal in Iran.  However, most of the international community clearly recognizes the need for individuals and companies to be held accountable for breaking the laws of foreign countries, and for this reason uses the tool of extradition as a transnational means of enforcing national and international laws.  Iran has no right to act as though its citizens are untouchable or exempt from following the laws of other countries.  More needs to be done to deter smuggling and encourage a change in Iran’s behavior.  The United States is right to seek the arrests of Iranian smugglers whenever it can.  It should counteract Iran’s defense of its smugglers abroad.  But these actions are not enough to guarantee the trial of Iranian smugglers for their crimes, and even less so to deter Iranians from smuggling.  Until a common criminalization system based in international law is set up to manage the modern crime of arms smuggling for military, missile, and nuclear programs, authorities will be forced to resort to complicated and potentially futile operations in their attempts to bring Iranian smugglers to justice.  The international community needs a coherent system to deal with issues of prosecuting transnational trafficking and smuggling, gaining extradition, and applying penalties against lawbreakers.  Countries need to commit to sharing evidence in transnational cases involving Iranian smugglers, making best efforts to extradite suspects to stand trial and provide needed witnesses, and taking action against Iranian smugglers operating on their territories. The United Nations Security Council should also broaden its application of sanctions to those who organize and carry out the smuggling of goods to Iran’s nuclear, missile, and military entities.  To operate, these individuals need to travel and maintain access to the world’s financial system.  Banning these activities would go a long way in undermining their ability to function. Countries like Iran may be deterred from their habitual disregard of others’ laws if its agents both inside and outside Iran were more routinely subject to sanctions and prosecution using internationally established norms and judicial practices.     * ISIS wishes to thank 60 Minutes for pointing out several of these cases. 1 See the case of Mahmoud Yadegari: “A Smuggler’s Procurement of Nuclear Dual-Use Pressure Transducers for Iran,” by David Albright, Paul Brannan, and Andrea Scheel, ISIS, July 14, 2009. http://isis-online.org/uploads/isis-reports/documents/Yadegari_Iran_illicit_trade_14July2009_1.pdf; the case of Mohsen Vanaki: “The Trials of German-Iranian Trader Mohsen Vanaki,” by David Albright and Christina Walrond, ISIS, September 16, 2009, rev. October 23, 2009. http://isis-online.org/uploads/isis-reports/documents/MohsenCaseStudy_23Oct2009.pdf and “Decision Reached in Vanaki Case: Landgericht Finds Defendant Guilty, Issues Suspended Sentence,” by David Albright and Christina Walrond, ISIS, October 23, 2009. http://isis-online.org/isis-reports/detail/decision-reached-on-vanaki-case-landgericht-finds-defendant-guilty-issues-s/20; as well as “Iran’s Procurement of U.S. Military Aircraft Parts: Two Case Studies in Illicit Trade (Case 1),” David Albright, Paul Brannan, and Andrea Scheel, ISIS, May 21, 2009. http://isis-online.org/uploads/isis-reports/documents/Iran_Aircraft_Procurement.pdf 2 Laura Rozen, “Iran Links U.S. Hikers Case to Detained Iranians,” Politico, December 9, 2009. 3 Department of Justice Press Release, “Iranian Arms Procurement Agent to be Sentenced,” December 2, 2009. 4 “Inventive U.S. Sting Operation Catches Iran-Based Military Equipment Smuggler,” David Albright, Paul Brannan, and Andrea Scheel Stricker, ISIS, February 16, 2010. 5 “Alleged Middleman Majid Kakavand Arrested for Directing Malaysia-Based Illicit Procurement Scheme,” David Albright, Paul Brannan, and Andrea Scheel Stricker, ISIS, February 16, 2010. 6 “Iran’s Procurement of U.S. Military Aircraft Parts: Two Case Studies in Illicit Trade (Case 2),” David Albright, Paul Brannan, and Andrea Scheel, ISIS, May 21, 2009. http://isis-online.org/uploads/isis-reports/documents/Iran_Aircraft_Procurement.pdf 7 “Former Iranian Ambassador Arrested in Britain for Allegedly Assisting Iran-Directed Smuggling Scheme,” David Albright, Paul Brannan, and Andrea Scheel Stricker, ISIS, February 16, 2010. 8 “Arrest Made in Germany of Core Iranian Procurement Agent,” David Albright, Paul Brannan, and Andrea Scheel Stricker, ISIS, February 16, 2010. 9 Mark Hosenball and Michael Isikoff, “Administration Frustration,” Newsweek, October 8, 2008. 10 “Iran Denounces Trial of National in U.S., Calls it Politically Motivated,” The Tehran Times, December 9, 2009; “Iran Urges France to Free Engineer Wanted by U.S.,” Agence France Presse. January 19, 2010; “Iran Asks U.K. to Release Ex-Diplomat,” Iran Press TV.  July 23, 2008. 11 “White House Denies Prisoner Swap Talks with Iran,” Agence France Presse. February 2, 2010; “Iran Links U.S. Hikers Case to Detained Iranians;” Mark Hosenball, “Is Iran Playing Games with ‘Hostages?’” Newsweek, December 17, 2009; Angela Doland, “Engineer’s Arrest Exposes U.S. Pursuit of Iranians,” Associated Press.  January 22, 2010; Nasser Karimi, “Iran Says France Using Iranian’s Trial to Pressure,” Associated Press.  January 19, 2010. 12 Andrea Scheel Stricker, “Update: Smuggler Previously Convicted of Aircraft Export Control Violations; Disguised Company as Larger Operation” ISIS, October 23, 2009, http://isis-online.org/uploads/isis-reports/documents/Iran_Aircraft_Procurement_Update_23Oct2009.pdf ; Andrea Scheel Stricker, “A Smuggler’s Use of the U.S. Financial System to Receive Illegal Payments from Iran,” ISIS, October 23, 2009, http://isis-online.org/uploads/isis-reports/documents/Limmt_Li_Fang_Wei_23Oct2009.pdf Iran, Illicit Trade 2010-02-16T16:06:37+00:00 http://isis-online.org/isis-reports/detail/former-iranian-ambassador-arrested-in-britain-for-assisting-iran-directed-s/http://isis-online.org/isis-reports/detail/former-iranian-ambassador-arrested-in-britain-for-assisting-iran-directed-s/#When:16:06:15Z In October 2006, British authorities arrested former Iranian ambassador to Jordan, Nosratollah Tajik at the request of the U.S. government for allegedly assisting in brokering the purchase of U.S.-made military night vision systems for Iran. 1  His arrest demonstrates a link between Iranian military entities and former high level Iranian government officials in efforts to smuggle military equipment. Tajik was arrested because of his attempted dealings with undercover U.S. export enforcement agents between the period from October 2005 to August 2006, during which he and Esmaiil Gharekhani, an alleged co-conspirator based in Iran, allegedly tried to buy night vision systems from U.S. agents posing as arms brokers, and arrange their shipment to European countries, Turkey, or Dubai where they would be transshipped to Iran.  2 Tajik, who is out on bail in Britain, awaits consideration of an appeal to the British Home Secretary over whether earlier authorizations for his extradition to face trial in the United States could be overturned based on inability to travel due to ill health. 3  If extradited to the United States and convicted of the crimes, Tajik could face more than ten years in prison and large fines.  Authorities have not arrested Gharekhani. Unusual Procurement Agent Nosratollah Tajik, 55, served as Iran’s ambassador to Jordan from 1999-2003, according to an investigation by U.S. export enforcement agents and Britain’s Her Majesty’s Revenue and Customs agency (HMRC). 4  Following his government service, Tajik moved with his family to Britain on an honorary fellowship to teach Farsi at the Institute for Middle East and Islamic Studies of the University of Durham and pursue an engineering PhD at the University of Westminster. 5  According to an affidavit of the ICE agent assigned to his case, Tajik also directed a private limited company called UK Islamic Direct Business Limited with locations in Tehran and Harrow, Middlesex, England. 6  Previously, a Newsweek report stated, Israeli intelligence investigated the activities of Tajik during his ambassadorship as they related to recruiting Palestinian trainees for terrorist operations against Israel. 7 Tajik was indicted by the United States Northern District of Illinois Court in August 2006 on two counts of conspiring to export the military night vision equipment without a license from the State Department’s Directorate of Defense Trade Controls.  The items were considered defense articles controlled for export by the International Traffic in Arms Regulations and U.S. Munitions List. 8  Gharekhani directed the procurement scheme from Iran and used Tajik, a close friend, and his Britain-based company, for brokering and transshipment purposes.  ICE Agents determined that Gharekhani worked as a procurement agent supplying the needs of the Iranian military via his position at Industrial Automation Group (IAG), located in Tehran. 9  According to websites such as TradeKey.com that list and identify companies, IAG was “founded by a group of experts, well educated engineers of best Iranian universities…in the field of industrial vibration measurement, modal test, fatigue, control, industrial automation, and measurement tools.” 10  Gharekhani’s Iranian customers are not detailed in legal documents relating to the case, but they were likely entities of the Iranian military establishment that use Industrial Automation Group as an equipment supplier.  The address listed for IAG, at the intersection of Pasdaran Avenue and Dolat Street, is located within a well-known Defense Industries Organization (DIO) neighborhood in northeastern Tehran. Gharekhani allegedly sent purchase orders from his Iranian customers, directly to ICE agents posing as company officials or brokers for the night vision equipment.  In 2004, ICE launched a wide ranging operation that set up phony companies that could receive illicit procurement requests from arms traffickers with the objective of prosecuting them for attempts to commit crimes. 11  ICE agents told Gharekhani that they could broker high value military equipment sales based on insider connections at prominent U.S. manufacturers Use of Britain as a Transshipment Point Tajik allegedly assisted Gharekhani by communicating with U.S. agents to arrange transshipment and payment for items, suggesting both Dubai and the United Kingdom as transshipment points.  He stated his preference and past success in using Britain as a shipping destination for U.S. goods before they went to Iran. 12  Tajik and Gharekhani allegedly operated under a strategy of mislabeling and undervaluing the contents of packages in order to export them out of the United States to third party countries, and from third party countries to Iran.  The following details the alleged procurement attempts and scheme used by the Gharekhani-Tajik procurement ring to try to acquire controlled equipment from the United States.  Because the attempted procurements, particularly a plan discussed over many months to order night vision systems, were part of the U.S. sting operation, none of the equipment was sent to Iran.  The accused have not yet been convicted of any crimes.  Procurement Attempts It appears that Gharekhani first contacted a U.S. company by e-mail requesting to purchase night vision binoculars, goggles, tools, laser range finders and laser aiming guns for around $3 million.  He said that he wanted to be their “exclusive agent in Iran.” 13  The company apparently referred the e-mail to authorities, who identified Gharekhani’s internet protocol (IP) address as belonging to the Industrial Automation Group in Tehran.  Authorities referred Gharekhani to an ICE e-mail address, which they called the e-mail address of “a local representative that may be able to assist.” 14  In October 2005, ICE agents based in Chicago posed as company officials or brokers and responded by telephone to see if they could launch a sting operation against Gharekhani and any associates for illicit procurement attempts. The ICE agent who telephoned Gharekhani asked whether his customer was located in Iran, and he said that this was the case.  The agent said that the night vision equipment sought was embargoed for export to Iran, and Gharekhani replied that the equipment could be sent to his “office” in Istanbul, Turkey and then onward to Iran.  The agent expressed caution over exporting items without a license because of the illegality of the exports even if sent first to Turkey, but Gharekhani assured the agent that they would have “wide cooperation.”  In January 2006, a second agent send Gharekhani a price quote of $55,170 for night vision equipment and discussed involving another supplier “friend” (undercover ICE agent) in the transaction.  In February, Gharekhani recommended shipping the items to Iran via his partners’ offices in Sweden, Germany, or Turkey.  He said the agents could ship the holographic weapon sights to Turkey but mischaracterize the contents of the package as a gift with no value, and he provided an address in Istanbul for shipping purposes.  In March, Gharekhani changed these plans, notifying the agents that the Turkish government could be difficult over imports and exports, and they should now plan to send the equipment to a Dubai address belonging to another “partner.” 15 In May 2006, Gharekhani again changed plans, informing the ICE agents that they should deal with his partner, Mr. Tajik, based in the United Kingdom.  Gharekhani stated, “I think it is better for you to do business with a British company” for added security, and he said that Mr. Tajik, one of his best friends, knew the details about the order and Gharekhani’s business and would call to finalize shipping arrangements.  Tajik soon phoned the agents and despite being informed that it was illegal to ship U.S.-origin items to Iran from Britain, he assured the agents that his “colleague” in Dubai could successfully receive the items either directly from the United States or from the United States via Britain. 16 When asked whether he had previously transshipped U.S. items before, Tajik responded “Yes, yes, yes. Night vision plus the other equipment…I did it last month and it was no problem.”  He said that he had acquired these items from a U.S. company which did not suspect the shipment would be diverted from Britain, and that he shipped the items to Iran on Iran Airlines.  Regarding the U.S. company, Tajik said, “…They just know the goods, the instrument is going to the U.K…and then in the U.K. we change the label…and we change the name and send it to Iran.”  Tajik asked the agent about his or her relationship with one of the companies that were poised to make a deal for the night vision systems, and the agent responded that he or she had a relationship with an insider who had agreed to make illicit sales for payment. 17 Tajik and Gharekhani arranged to open a letter of credit to pay for the items once they were shipped to Britain or Dubai, but the ICE agents demurred that using letters of credit for payment after shipments were sent were risky.  Tajik replied that they were not authorized to send money before shipments were received, and that another option would be to bring the equipment to London and meet in person to exchange the equipment for payment.  In July 2006, an ICE agent sent an invoice for a sale totaling $51,155 for a holographic weapons sight, night vision sight, night vision weapon sight, binocular night vision goggle, 2 night vision goggles, 3 modular day/night weapon sights, monocular night vision device, and an auto gating night vision image intensifier tube.  All of the items except the holographic weapon sight are controlled for export on the U.S. Munitions List.  Gharekhani indicated the payment was ready; he e-mailed the agents a copy of a bank wire transfer from Saman Bank Corporation to Tajik’s bank account at HSBC Bank in Britain. 18 The agents agreed preliminarily to deliver the items directly to Tajik during a meeting at his Durham, England office on August 17, 2006, but then said that they would rather discuss the deal and show Tajik some of the equipment without finalizing the sale until later.  During the videotaped meeting with two agents, Tajik was shown some of the military equipment and appeared to know how to operate it.  Tajik requested that agents provide two invoices with the items once they were delivered, one with the accurate description and price of the items for the Iranian customer, and another misrepresenting and undervaluing the items, the invoice that would be attached to packages going through British customs to Iran so they would clear without problems.  Tajik also inquired about purchasing a Millennium 35 mm naval gun system with anti-guided missile capabilities made by a Swiss company, Oerlikon Contraves, and sold in the United States by Lockheed Martin.  The agents informed Tajik that they were acting illegally by bringing the night vision systems to Britain to discuss a sale to Iran. 19 Apparently becoming suspicious, Tajik began attempting to obscure the conversation from electronic surveillance by asking that a radio be turned on (one was not available), and then tapping his fingers on the table while speaking in low tones.  Despite this, the participants agreed upon the final terms of the deal for night vision equipment and discussed the possibility of future cooperation.  Following the meeting, in August, Gharekhani informed the agents by e-mail that the money was ready and also inquired about purchasing items made by Raytheon.  Tajik e-mailed the agents on August 30 asking when they would come to Durham to deliver the equipment. 20 In October 2006, British authorities arrested Nosratollah Tajik at his residence in County Durham, England following the approval of an arrest warrant stemming from a U.S. arrest and extradition request filed in the Northern District of Illinois on August 30, 2006. 21  He remains out of prison on bail pending his planned extradition to the United States. British Extradition Proceedings In April 2007, a British district court ruled that Tajik could be extradited to the United States, and referred Tajik’s appeal over the matter to the British Secretary of State.  In June 2007, the British Secretary of State authorized Tajik’s extradition.  He also appealed this extradition authorization and a hearing was held on April 10, 2008 by the High Court of Justice to revisit the decision of the district court. 23 During this hearing, Tajik’s legal representation raised issues over: whether Tajik could legally face extradition since the offenses committed did not take place inside the United States; whether he was physically and mentally fit to stand trial abroad; whether the United States had abused the British process of extradition by entrapping him in a sting operation and accusing him of a crime; whether he was likely to be targeted as a terrorism suspect or enemy combatant on account of the poor relations between the United States and Iran, potentially facing discrimination during a trial; whether he could be charged with additional offenses not included in the original charges once extradited; and whether his or his family’s private lives could be threatened should he be extradited.  The high court did not agree that these issues raised relevant legal concerns and stood by the district court’s earlier ruling and the decision of the Secretary of State that Tajik should be extradited. 24 The British Home Secretary is reportedly considering another appeal by Tajik that he is physically unfit for travel to the United States due to heart complications and surgeries exacerbated by the emotional trauma of legal proceedings. 25  Iranian foreign minister Manouchehr Mottaki requested the release of Tajik in meetings with British counterparts, but his request was denied.  Minister Mottaki claimed the decision was “unethical.” 26   Lessons and Observations The Tajik case shows that procurement efforts are undertaken by former high-level Iranian officials in support of Iran’s military activities.  It also demonstrates that Iranian procurement agents operate in a dispersed, networked fashion with trusted overseas agents stepping in to help as needed.  The case also demonstrates the methods used by illicit procurement entities in order to avoid detection.  The key strategies included using transshipment countries, altering labels on the goods and likely the export documents as well, and undervaluing the goods being shipped.  When a sensitive item is leaving a country with more robust controls, such as the United States, the description of the items on the package and on customs declarations need to be accurate, so as not to arouse suspicions by the supplying company or customs authorities.  Once the items arrive in the next country, however, the procurement agent changes the description of the products and, accordingly, its value, in order to ease its export to a country like Iran, as customs agents will scrutinize product descriptions and values for potentially banned items.  Short of opening a package, customs agents have the product descriptions and other declarations to rely on.  The above methods are used consistently by illicit procurement entities, including those in the A.Q. Khan network who sent to Libya equipment related to a planned covert gas centrifuge program. Any country, even Britain with its sophisticated export control system, can become a transshipment address for Iran’s military procurement efforts.  This case also shows how smugglers probe for transshipment locations, seeking the ones they believe will most likely to lead to a successful procurement. This case shows how good cooperation between authorities, in this case between the United States and Britain, can lead to successful arrests and extradition authorizations for those engaging in illicit military trade.  However, extradition can be a time-consuming and difficult process.  A successful extradition is by no means guaranteed.     1 U.S. Immigration and Customs Enforcement, “Counter-Proliferation Investigations: Overview- Military Night Vision Systems to Iran,” October 28, 2008 2 Affidavit of Mark Knoblock, Special Agent, Immigration and Customs Enforcement, U.S. Department of Homeland Security, in Support of Criminal Complaint before the United States Magistrate Court of the Northern District of Illinois, Eastern Division, for the case United States of America v. Esmaiil Gharekhani and Nosratollah Tajik, August 30, 2006. 3 “Former Diplomat Sought by U.S. May be Released,” The Durham Times, December 18, 2009. 4 Affidavit of Mark Knoblock, p. 17. 5 High Court of Justice of the Royal Courts of Justice, Approved Judgment before Lord Justice Richards and Mrs. Justice Swift Dbe, between Nosratollah Tajik and the Government of the United States of America and Secretary of State for the Home Department, April 10, 2008, p. 11. 6 Affidavit of Mark Knoblock, p. 16. 7 Michael Isikoff and Mark Hosenball, “Red Flag,” Newsweek, November 16, 2009. 8 Affidavit of Mark Knoblock, pp. 3-4. 9 Affidavit of Mark Knoblock, p. 6. 10 http://jp.tradekey.com/profile_view/uid/203950.htm 11 Carrie Johnson and Spencer S. Hsu, “Cat-and-Mouse Game Traps Arms Broker,” The Washington Post, December 3, 2009. 12 Affidavit of Mark Knoblock, p. 15. 13 Ibid, p. 5; The Affidavit states that this e-mail was sent to a U.S. e-mail address and was brought to the attention of law enforcement officials.  From this information, one can infer that it may have been a U.S. company or supplier that was the original recipient of the e-mail. 14 Affidavit of Mark Knoblock, p. 6. 15 Ibid, pp. 9-12. 16 Ibid, pp. 13-15. 17 Ibid, p. 15. 18 Ibid, pp. 15-23. 19 Ibid. pp. 23-25. 20 Ibid, pp. 25-26. 21 “Overview- Military Night Vision Systems to Iran;” Affidavit of Daniel Rubenstein, Assistant U.S. Attorney for the Northern District of Illinois, Department of Justice, in Support of Request for Extradition of Nosratollah Tajik, before United States Magistrate Judge of the United States District Court, Northern District of Illinois, Eastern Division, August 30, 2006. 22 “Court Supports U.S. Extradition Bid,” BBC News. April 19, 2007. 23 Approved Judgment before Lord Justice Richards. 24 Ibid. 25 “Former Diplomat Sought by U.S. May be Released;” Approved Judgment before Lord Justice Richards. 26 “Iran Asks U.K. to Release Ex-Diplomat,” Iran Press TV.  July 23, 2008.   Iran, Illicit Trade 2010-02-16T16:06:15+00:00 http://isis-online.org/isis-reports/detail/inventive-u.s.-sting-operation-catches-iran-based-military-equipment-smuggl/http://isis-online.org/isis-reports/detail/inventive-u.s.-sting-operation-catches-iran-based-military-equipment-smuggl/#When:16:06:04Z Iran-based smugglers of sophisticated military, missile, and nuclear goods operating on the government of Iran’s behalf have often believed that they are immune to overseas prosecution.  They are paid by their government’s military or nuclear entities, which view their actions as legal under Iranian law.  However, these smugglers and the Iranian government willfully ignore the laws of the supplier nations they target and international laws created by the United Nations Security Council.  The case of the Iranian citizen Amir Hossein Ardebili shows the determination of the U.S. government to bring Iranian smugglers to justice and thwart the Iranian government in its efforts to benefit from its nationally directed smuggling operations.  These methods should be applied aggressively to all smugglers that traffic these dangerous goods.  At the same time, international laws and cooperation should be strengthened and broadened to ease the process of prosecuting and convicting these smugglers and the officials behind them. In May 2008, Iranian citizen Amir Hossein Ardebili secretly pleaded guilty in a U.S. court to fourteen counts of violations of the U.S. Arms Control Act, International Emergency Economic Powers Act, and conspiracy, smuggling, and money laundering laws.  In December 2009, a U.S. federal court sentenced him to a sentence of five years in prison. 1 The arrest and conviction of Ardebili was a culmination of a three year sting operation directed by the U.S. Immigration and Customs Enforcement (ICE) agency aimed at busting his long running military procurement operation for the Iranian Ministry of Defense.  He was quietly arrested in October 2007 outside the United States after being lured from Iran by U.S. undercover agents to Tbilisi, Georgia to conclude what he presumed was an arms deal.  Agents seized his laptop, which contained extensive records of his smuggling operations and led ICE to keep his case secret as they followed up the leads contained on his computer.  He was extradited in January 2008 to Philadelphia for detention and subsequent trial in Delaware.  Two indictments against Ardebili, publicly released shortly before his sentencing, reveal that he was convicted of attempting to procure goods usable in Iranian attack aircraft, missiles, and missile guidance and target acquisition systems. 2 $1 Million Worth of Equipment per Year Ardebili, a 36-year-old engineer from Shiraz, Iran is described by the U.S. Department of Justice as a “prolific” arms smuggler, his efforts spanning at least five to six years based on records contained in the laptop seized during his arrest. 3  U.S. agents said that Ardebili’s operation obtained around $1 million in U.S. equipment each year. 4  Other unnamed “U.S. investigators” interviewed by Newsweek magazine said that Ardebili was “part of a network of fairly low-level middlemen whom the Iranian government hired to try to procure U.S. and other Western technology for its military and missile programs.” 5  The case’s legal documents do not reveal the name of his company or affiliation in Iran.  Between July 2005 and October 2007, the period of illegal activity for which he was convicted, Ardebili attempted to procure 10 QRS-11 Gyro Chip Sensors, 1,000 MAPCGM0003 Phase Shifters, and 2 DADC-107 Digital Air Data Computers. 6  According to the Department of Justice, QRS-11 Gyro Chip Sensors are controlled for their multiple aircraft, missile, and space applications.  Phase Shifters are usable in phased array radar, which guides missiles and helps them acquire targets.  Digital Air Data Computers are replacements for F-4 fighter jet Central Air Data Computers, and assist with the flying, attack, and high accuracy weapons delivery capabilities of the aircraft. 7  Ardebili was convicted of attempting to procure these items without an export license from the U.S. Treasury and State Departments, which control exports of sensitive equipment, respectively, via the Office of Foreign Assets Control (OFAC) and the Directorate of Defense Trade Control (DDTC) Munitions List. 8  Items not controlled for export on defense article lists but sent to Iran were exported in violation of the U.S. embargo against Iran. A Successful Sting Operation The investigation of Ardebili reportedly began after authorities received several tips from U.S. companies that they had received suspicious equipment requests. 9  Over the years, Ardebili sent tens of thousands of e-mails, often using aliases, to potential U.S. suppliers of equipment with uses spanning the gamut of naval, avionic, and conventional military programs.  Ardebili would deceive companies to obtain items by concealing his identity as an Iranian procurement agent, offering shipping addresses in countries less sensitive to export scrutiny, then diverting the items from third party countries to Iran.  The U.S. sting operation began in 2004 and encapsulated all of the violations for which Ardebili was convicted of between 2005 and 2007.  U.S. officials did not press charges for any of Ardebili’s past efforts, though they learned much about Iran’s inexhaustible efforts to illicitly acquire U.S. military technology and circumvent sanctions based on records from his seized laptop. 10  The Washington Post reported that in 2004, “ICE agents began laying the groundwork to target Ardebili, setting up counterfeit storefronts—in U.S. cities and in Europe—where they could receive electronic bids for sensitive technology barred from export to countries that pose a national security threat.” 11  The Post reported that ICE agents used a phony company in Philadelphia and began regularly communicating with Ardebili on the internet to solicit equipment deals.  Assistant U.S. Attorney for the District of Delaware David L. Hall, who prosecuted the case, told ISIS that a phony company located in Boston was also used to make deals.  The two companies are used by ICE as part of its wide-ranging counter trafficking operations.  ICE agents contacted Ardebili by e-mail, instant message, and phone offering to sell military items such as missile and night vision equipment. 12  Often, the agents would send e-mails using broken English in order to lend the appearance that they were not American.  They peppered their communications with acknowledgement that the deals were risky and illegal, but in response Ardebili proposed ways to circumvent sanctions.  During the conversations, Ardebili urged the agents to meet him in the United Arab Emirate of Dubai to conclude deals or to ship items through Europe where they could then be shipped to Iran. 13    Eventually, agents brokered deals to sell Ardebili the gyro chip sensors, phase shifters, and digital air data computers.  Ardebili reportedly had difficulties raising funds for the purchases (he also lived at home with his parents) leading his attorneys to assert that he was not as prolific an arms smuggler as prosecutors claimed and that they were going after a relatively small fish. 14  However, Ardebili sent a wire transfer of $7,000 for the gyro chip sensors from a bank account located in the United Arab Emirates to a bank account in Massachusetts held in the name of a phony ICE company. 15  He also sent a transfer from an Iranian bank to a Delaware bank account held by an ICE company in the amount of $2,980 for phase shifters, which agents told him could be shipped through Azerbaijan.  Those financial transactions were illegal because Iran is barred from doing business with U.S. banks.  Agents eventually persuaded Ardebili to fly from Tehran to Tbilisi, Georgia to meet with representatives from the Philadelphia “company.”  They even paid for his flight.  ICE agents, one from a European station involved in the deal, and one from the Philadelphia “company,” brought some of the items to the October 2007 meeting.  Undercover agents transported the phase shifters to Georgia as part of the phony deal in order to obtain additional evidence for the case, returning them to the United States after concluding the arrest.  According to Assistant U.S. Attorney Hall, delivery of the other requested items was never made.  The Boston company had told Ardebili that there were problems with the shipments of the gyro chip sensors, and the digital air data computers were never delivered.    The U.S. agents filmed their entire encounter with Ardebili for evidence. 16  When agents asked about the justification for his operation, Ardebili stated that the Iranian government believes war with the United States is coming and it is preparing its defenses. 17  Iran Becomes Involved Iranian representatives reportedly made personal contact with United Nations Secretary-General Ban Ki-moon in October 2009 to report concerns over Ardebili’s detention. 18  Iran sought contact with Ardebili following his sentencing though its interests section located at the Pakistani embassy in Washington, D.C., and also through the Swiss government, which facilitates U.S.-Iran contacts. 19  Iran also listed Ardebili on a list of eleven nationals it believes are being detained without merit by the United States.  Eight of those on the list are being held for investigation or are fulfilling sentences for nuclear or military equipment trafficking. 20  An Iranian NGO working with family members of the individuals is filing suit against the United States for what it believes is extraordinary rendition, false charges, and abduction of the citizens. 21  Iranian foreign minister Manouchehr Mottaki publicly demanded that the U.S. government release Ardebili since he believed the arrest was politically motivated and Ardebili’s guilty plea revealed an “inappropriate mental condition.”  Mottaki complained that, “For over one year we are uninformed about his fate.  Now we are faced with a clandestine legal procedure on his case.” 22  However, U.S. officials stated that there was a need to keep the detention of Ardebili a secret for two years while they pursued leads and analyzed the additional information obtained from his laptop. 23  Using information obtained from Ardebili’s laptop, ICE agents were able to arrest and convict a U.S. citizen based in Arizona for trying to sell equipment to Iran without a license. 24 On December 14, Ardebili was sentenced to five years in prison of a possible ten to fourteen years; his two years spent in jail prior to sentencing will count as time served.  Ardebili expressed remorse for his acts, tearfully begging the judge to consider that though he had broken U.S. laws, his activity was not illegal in Iran.  On the day of his sentencing, the city of Wilmington, Delaware, was forced to close down two city blocks surrounding the courthouse due to threats from an unknown party that Ardebili’s life was in danger. 25  Ardebili announced later that he would appeal his sentence. 26 Observations and Lessons This case and several other cases investigated or prosecuted by the United States over the last few years show that Iran’s efforts to acquire U.S. military, missile, and nuclear goods are both profound and considerably entrenched.  U.S. enforcement and investigatory agencies have become aware of the depth of the problem and have launched coordinated operations to stop it. 27  This case demonstrates that tips from U.S. suppliers to the U.S. government about suspicious requests can expose Iranian illicit procurement schemes to authorities, allowing them to bring smugglers to justice.  However, more can be done by the U.S. government to facilitate cooperation with key U.S. companies targeted by Iran and other states for sensitive goods.  With more cooperation by the U.S. government, including the more routine provision to companies of the names of smuggling fronts and activities, companies could better detect illegal procurement schemes, avoid accidental sales to Iran, and tip off the government about these efforts.  Countries like Iran whose governments direct procurement networks and operatives to illegally acquire sensitive technologies from abroad often have not feared that their procurement agents will be arrested and tried in foreign countries.  But to run their operations, these agents periodically have to leave Iran, at which point they can be arrested.  The United States is willing to exert exceptionally creative means abroad to thwart Iran’s illicit trade; other supplier countries should more aggressively join in these efforts.  U.S. authorities were able to painstakingly build their case against Ardebili, pose as arms salespeople, and lure him to a country amenable to U.S. extradition, ultimately convicting him of his crimes in the United States. However, the circuitous method used to ensnare Ardebili, luring him from one country and extraditing him from another, shows that this approach is fraught with potential for failure.  It is not the ultimate answer for successfully prosecuting smuggling of sensitive goods.  Moreover, Iran is increasingly taking action to defend its procurement agents arrested in the course of their smuggling operations, from independent contractors like Ardebili to formerly high level government officials.(link to Tajik)  Iran acts as if its violations of other countries’ laws is somehow justified, claiming that it is not illegal in Iran.  Even if agents are arrested, Iran has a plentiful supply of such agents anxious to make money.  Until a system is set up to manage the modern crime of arms smuggling, authorities will be forced to resort to complicated operations in order to bring smugglers to justice.  The irresponsible attitude of the Iranian government shows why the international community needs a coherent system to deal with issues of prosecuting transnational arms trafficking and smuggling, gaining extradition, and applying penalties against lawbreakers.  Countries like Iran may be deterred from their habitual disrespect of others’ laws if its agents both inside and outside Iran were more routinely subject to prosecution using internationally established norms and judicial practices.     1 John Shiffman, “In Tears, Iranian Arms Dealer Sentenced to 5 Years,” The Philadelphia Inquirer, December 14, 2009. 2 Department of Justice Press Release, “Iranian Arms Procurement Agent to be Sentenced,” December 2, 2009; John Shiffman, “Iranian Arms Dealer, Extradited in ’07, Secretly Jailed in Philadelphia,” The Philadelphia Inquirer, December 2, 2009. (This article’s title erroneously indicates the date of Ardebili’s extradition as 2007; he was extradited in 2008, which the text of the article does note.) 3 DOJ Press Release; “Iranian Arms Dealer, Extradited in ’07.” 4 John Shiffman, “Iranian Arms Merchant Says ‘War is Coming,’” The Philadelphia Inquirer, December 3, 2009. 5 Mark Hosenball, “Is Iran Playing Games with ‘Hostages?’” Newsweek, December 17, 2009. 6 Ibid. 7 DOJ Press Release. 8 United States District Court for the District of Delaware, Indictment, United States of America v. Amir Hossein Ardebili, a/k/a Amir Ahkami, a/k/a Alex Dave, Cr. A. No. 07-155, November 19, 2007; United States District Court for the District of Massachusetts, Indictment, United States of America v. Alex Dave, a/k/a, Amir Ahkami, a/k/a Amir Ardebili, a/ka/ Arash Koren, March 6, 2008. 9 Sebastian Rotella, “Iranian Arms Trafficker Sentenced to 5 Years,” The Los Angeles Times, December 15, 2009. 10 “Iranian Arms Dealer, Extradited in ’07.” 11 Carrie Johnson and Spencer S. Hsu, “Cat-and-Mouse Game Traps Arms Broker,” The Washington Post, December 3, 2009. 12 “Iranian Arms Dealer, Extradited in ’07.” 13 “Iranian Arms Merchant Says ‘War is Coming.’” 14 Laura Rozen, “Ardebili’s Laptop,” Politico, December 22, 2009. 15 District of Massachusetts, Indictment, p. 6. 16 Video surveillance footage released by U.S. authorities of the meeting between undercover ICE agents and Ardebili in October 2007 in Georgia is available on the Philadelphia Inquirer website (http://www.philly.com/) by searching “Ardebili.” 17 “Iranian Arms Merchant Says ‘War is Coming.’” 18 “Iranian Arms Dealer, Extradited in ’07.” 19 “Is Iran Playing Games with ‘Hostages?’” 20 “Ardebili’s Laptop;” Laura Rozen, “Iran Links U.S. Hikers Case to Detained Iranians,” Politico, December 9, 2009. 21 Ibid. 22 “Iran Denounces Trial of National in U.S., Calls it Politically Motivated,” The Tehran Times, December 9, 2009. 23 “In Tears, Iranian Arms Dealer Sentenced to 5 Years.” 24 “Ardebili’s Laptop.” 25 Ibid. 26 “Iranian Appeals Prison Sentence for Arms Smuggling,” Associated Press.  December 28, 2009. 27 See for example ISIS case studies on Iran’s illicit trading efforts and U.S. legal cases against defendants: http://isis-online.org/isis-reports/case-studies/category/illicit-trade/#2009 Iran, Illicit Trade 2010-02-16T16:06:04+00:00 http://isis-online.org/isis-reports/detail/middleman-arrested-for-directing-malaysia-based-iranian-illicit-procurement/http://isis-online.org/isis-reports/detail/middleman-arrested-for-directing-malaysia-based-iranian-illicit-procurement/#When:16:05:44Z In March 2009, Majid Kakavand, an Iranian citizen, was arrested in France on fifteen counts of conspiracy to export U.S.-made items to Iran, money laundering, smuggling, making false statements, and fraud.  Beginning in January 2006 until around December 2008, Kakavand and two associates who are also under indictment allegedly ran a front company in Malaysia called Evertop Services Sdn Bhd, which illicitly bought electronic equipment from firms in the United States and Europe.  The accused allegedly operated the company from Iran, directing at least 30 known shipments of U.S.-made items worth more than $1 million to a freight forwarder in Malaysia, and then re-exporting the items on IranAir to Iranian military entities flagged on U.S. watch lists.  The alleged exports violated the U.S. embargo against Iran and Office of Foreign Assets Control (OFAC) licensing requirements. 1 Based on a tip from a U.S. company, U.S authorities began investigating the activities of Evertop Services in October 2007.  This investigation led to Kakavand’s indictment and arrest on a provisional arrest request while in France.  The United States is seeking extradition of Kakavand from France to stand trial. 2  If successfully extradited and convicted of the crimes, Kakavand could face multiple years in prison per count and millions of dollars in fines. Simple Malaysia-Based Procurement Network Kakavand and his two associates, Amir Ghasemi and Alex Ramzi, established Evertop Services Sdn Bhd in Kuala Lumpur, Malaysia in 2005.  This company also maintained a small office in Singapore, but Kakavand was not indicted on any charges relating to shipments through Singapore.  It also allegedly attempted to use other company names and aliases for company officials.  Evertop Services allegedly targeted both United States and European companies, but U.S. legal documents relating to the Kakavand case do not indicate information regarding European purchases.  Kakavand, 37, was an electrical engineering employee of an oil company in Iran who took a second job procuring items through Evertop Services (though reports differ). 3  He was co-director of Evertop Services, and Amir Ghasemi was also co-director.  Both resided in Iran.  Kakavand was previously investigated by the U.S. Immigration and Customs Enforcement (ICE) agency on suspicion that he was a procurement agent for the Iranian military.  In 2006, ICE investigated a tip that Kakavand attempted to procure High Capacity Line of Sight military radio communication systems from a U.S. company. 4  Alex Ramzi was the purchasing supervisor for Evertop Services. 5  The U.S. indictment of Kakavand and his associates does not indicate where Ramzi resided.  The U.S. companies allegedly targeted by Evertop Services were located all over the continental United States in states such as Alabama, California, Florida, New Jersey, and Washington, and manufactured or sold electronic items usable in military, avionic, and aerospace programs.  Evertop Services allegedly procured electronic items such as connectors, capacitors, resistors, measurement systems, reflectometers, rivets, and pressure sensors by telling the U.S. companies that the final destination of the items was Malaysia or that items would not be diverted to a country under U.S. trade sanction.  Evertop Services sent its purchase requests to companies exclusively via email, through which it allegedly claimed to be a fully-functional trading company that sold electronic and electrical component parts to clients such as telecommunications firms located in the Middle East and Southeast Asia. 6  According to the U.S. indictment of Kakavand and his associates, Evertop Services was a phony end destination, or front company, whose purpose was to divert items to the Iranian military. 7  According to affidavit of an Immigration and Customs Enforcement agent assigned to Kakavand’s case, authorities obtained a February 2006 correspondence from Kakavand’s e-mail account to an unspecified recipient which described the modus operandi of the company: “Our company is a small business office only.  There are two directors for this company both resident in Iran….This is just a small private company stablished(sic) in Malaysia for the sake of shipment purposes only…Now we have a small office in Singapore that is being managed by one employee there.” 8  A March 2006 communication with an unnamed freight forwarding service, possibly K Line Logistics,  indicated, “We have recently established this company in Malaysia.  Before this we handled our works in Sinapore…We are Iranian.  We have also got an office in Tehran.  Of course as you know, our company has been registered in Malaysia.” 9 Kakavand and his associates allegedly routinely signed certifications for U.S. companies stipulating that items would not be transshipped to embargoed or sanctioned countries.  Once items were purchased and sent to Malaysia via unspecified U.S. freight forwarders, Evertop Services allegedly used an international freight forwarding company called K Line Logistics to receive and ship the items from Malaysia to Iran on IranAir.  K Line Logistics is headquartered in Tokyo, Japan and has offices in Malaysia and the United States. 10    Evertop Services’ customers in Iran allegedly included Iran Electronics Industry (IEI) and Iran Communications Industries (ICI), two key suppliers to the Iranian military that in September 2008 were added to OFAC’s Specially Designated Nationals (SDN) and Blocked Persons List based on evidence that they procure items for Iran’s ballistic missile and nuclear programs.  The SDN list specifies entities and individuals that work to procure sensitive items for sanctioned countries, and entities and persons on this list are prohibited from doing business with U.S. companies.  For many years, IEI and ICI also have appeared prominently on German warning lists, which are confidential memos provided to German companies by the government, warning them about doing business with companies or entities on the lists.  IEI manufactures and offers “a diversified range of military products” including missile launchers, electronic warfare equipment, and manufactured night vision systems and laser range finders. 11  IEI was a well-known buyer for the Iranian Ministry of Defense Armed Forces and Logistics section on German government warning lists.  ICI is Iran’s “leading manufacturer of military and civilian communication equipment and systems,” 12 producing tactical communications and encryption systems.  E-mails obtained by U.S. authorities revealed that ICI in particular pressured Kakavand in meetings to quickly acquire needed items. 13  Kakavand and his associates allegedly transferred payments for purchases from Maybank in Malaysia to the bank accounts of U.S. companies.  The money supply for at least one of these alleged payments might have originated at the Shiraz branch of Bank Melli, Iran’s state-owned bank that is sanctioned by the United States and European Union and included in United Nations Security Council Resolution1803 as a bank whose activities states should “exercise vigilance over.” 14 Transactions originating from Bank Melli or any other Iranian financial institutions would have been laundered through Malaysia’s Maybank, or made to appear as though they were originating in Malaysia so that U.S. banks would accept the alleged transfers. At Least 30 Illegal Procurements Alleged In total, from 2006 until 2008, Evertop Services allegedly made at least 30 illegal procurements of U.S.-made electronic items, garnering $1,187,212 in equipment purchases from U.S. companies. 15  Three of these alleged procurements are indicative of the tactics used by the Iran-based procurement agents to acquire items from U.S. companies.  The accused have not yet been convicted of any crimes. In December 2006, Evertop Services contacted a Northvale, New Jersey company on behalf of Iran Electronics Industries (IEI) for the purchase of 1000 capacitors and 400 resistors, valued at $7,046.  Amir Ghasemi allegedly signed a certification stating that the items would not be transshipped from Malaysia in violation of U.S. law, and the New Jersey company did not apply for an export license when it shipped the items to “Evertop K Line” since they were not controlled for shipment to Malaysia.  In March 2007, K Line Logistics shipped the items to IEI in Iran via IranAir.  Iran’s Bank Melli location in Shiraz was notified of the delivery. 16 In August 2007, Evertop Services contacted a Morgan Hill, California company to purchase 85 pressure sensors.  Evertop Services sent a request for quote (RFQ) to the company suggesting a sale price of $17,000 for the 85 pressure sensors.  At some point following this, the Morgan Hill company notified an agent from the U.S. Bureau of Industry and Security (BIS) that it had received a transfer of $16,960 from Evertop Services for sensors, which it had shipped in November 2007 without a license to Malaysia.  Ghasemi e-mailed K Line Logistics in Malaysia to urge haste in shipping the items to Iran, and K Line Logistics then shipped the items on IranAir to a location called “Farazeh Tajhiz Gostar” in Tehran.  The nature of this entity is unclear from the U.S. indictment, and the entire name does not appear in internet searches (though “Tajhiz Gostar” appears in several variations of Iranian company names that are medical supply or engineering firms). 17 A third procurement indicative of the alleged scheme was made in January 2008 of 2,500 inductors from a Milpitas, California company on behalf of Iran Communications Industries (ICI).  Ghasemi signed an end-use statement from the company indicating that the shipment would not be sent to a country under sanction by the United States.  The Milpitas company did not apply for a license for the $17,855 shipment before shipping the items, and received payment for items sold from Evertop Services’ Maybank bank account.  The items were scheduled for delivery to Malaysia, and K Line Logistics was instructed to ship them to ICI on the next available IranAir flight once they arrived.  However, in July 2008, the Northern District of California obtained a federal search warrant that led to the seizure of the 2,500 inductors from an unnamed U.S. freight forwarder that was apparently preparing or in the process of shipping the items to Malaysia. 18 In May 2008, Kakavand allegedly attempted to create a new company in Malaysia for receiving and shipping purposes, and investigated the availability of registering one of four different innocuous-sounding company names: Vertex Technology Sdn Bhd, Zenith Technology Sdn Bhd, Summit Technology Sdn Bhd, and Microsun Technology Sdn Bhd. Evertop Services’ activities continued following the July 2008 shipment disruption.  In November 2008, a New Jersey company informed the BIS agent assigned to Kakavand’s case that its Australian representative had received enquiries from Evertop Services about purchasing items, with the claimed end destination of goods being Malaysia. 19  In June 2008, Kakavand indicated in an e-mail communication to an unspecified individual that Evertop Services was also using an Armenian alias to procure items: Armen Vartanyan.  He instructed the individual to take messages for Armen, an alias which his “friend” was using. 20 Extradition Pending Kakavand was arrested on March 20, 2009 while arriving in France at Paris’ Charles de Gaulle International Airport while traveling to Paris on a tour of Europe with his wife.  The U.S. Magistrate Court of the District of Northern California made a provisional arrest request, and French authorities identified him as he passed through customs.  According to the BIS special agent who investigated the sales requests of Evertop Services to California companies, officials from ICE began investigating Evertop Services’ activities in October 2007, which later led to the arrest request and indictment of Kakavand. 21  According to this time frame, the ICE investigation may have begun following suspicions reported about Evertop Services by the Morgan Hill, California company. Kakavand was released from prison in August 2009 but is not allowed to leave France.  The matter of Kakavand’s extradition will be decided on February 17 following extradition hearings that took place in France.  Iran has denounced the detention and extradition proceedings over Kakavand.  Iranian foreign ministry spokesperson Ramin Mehmanparast said that Kakavand was innocent and that the United States and France were seeking to pressure Iran for unspecified reasons, even using forged evidence concocted by the United States. 22  According to the Associated Press, French media reports have claimed that Iran offered to release two French women being held in Iran on charges of supporting the government opposition in return for Kakavand’s release, and other reports said that France proposed the deal. 23  Authorities in both countries denied the reports.  Kakavand and his lawyers maintain that the items he allegedly bought and exported to Iran could not be used in military programs and were exported without violating licensing requirements to Malaysia. 24  A U.S. Department of Justice official, speaking anonymously to the Associated Press, said that trading companies and agents doing business with many nations “have an obligation to follow the laws of each of those countries, not just those they see fit.” 25      Lessons and Observations Malaysia remains an important point of transshipment for U.S.-made items heading to Iran.  Malaysia has resisted international pressure, particularly its obligations under U.N. Security Council Resolution 1540, to create and implement export controls and monitor the activities of companies on its territory.  The United States should pressure Malaysia to implement export control laws as it did with the UAE in 2007.  Unless Malaysia creates and implements export control laws, the United States government should add licensing requirements to the export of a wide range of dual-use items to Malaysia, requiring Malaysian companies to provide verified assurances that the goods will not be secretly transshipped elsewhere.  This case study reveals that Iran successfully used a relatively uncomplicated procurement scheme to acquire vast quantities of electronic items for Iranian military entities.  In this instance, a single front company operated remotely from Iran purchased items from the United States and sent them to a freight forwarding location in Malaysia.  The simplicity of this scheme shows that U.S. companies need to exercise more caution when doing business with acknowledged Malaysian trading companies and middlemen, especially in this case where an Evertop Services official admitted to being an Iranian with a Malaysia-registered company.  Companies also should do more to verify the legitimacy of the buyer of the items’ physical address.  Companies might have been able to determine that the shipments were headed to a freight forwarding address if this were not already obvious from shipping destination names such as “Evertop K Line,” the name given for the procurement from the New Jersey company.  A simple internet search on the second part of the company name, “K Line”, would have shown that it is a major global freight forwarder, if they weren’t already known by reputation. Shipments to Malaysian freight forwarders should raise red flags for responsible company export compliance officials given Malaysia’s well known status as a transshipment point for Iran, Pakistan, and other countries.  Simple checks can often reveal potential illicit procurement schemes before sales are made and companies face potential fines and prosecution for export control noncompliance. Companies need more information from the U.S. government about the latest illicit procurement schemes and attempts, including up-to-date individual and entity names that often only intelligence agencies have.  Too often, U.S. companies rely on outdated and incomplete lists of entities and individuals when authorizing foreign sales.  The fact that Kakavand was previously investigated for illicit procurements, for example, was likely not information available to company compliance officials.  This may have been useful knowledge for companies that perform simple screening checks of potential clients against lists of names, associates, and companies suspected of illicit trading by the U.S. government.  Germany and Britain routinely provide their domestic companies with more information about which Iranian companies and entities to avoid.  The United States needs to share more information about companies and entities discovered to be working for Iran’s military or nuclear programs.  In the Kakavand case, U.S. authorities were slow to alert companies about the risk posed by Kakavand and Iranian entities such as IEI and ICI.  If notified, U.S. suppliers could have avoided Kakavand’s enquiries or requests for quotes.  In the end, prevention of a sale is more valuable than punishment after the fact.  More than $1 million in military-usable electronic equipment was diverted to Iran through Malaysia in a simplistic scheme that was missed for nearly a year by both company compliance and U.S. government export enforcement systems.  It is clear that the system has not worked optimally, and U.S. government and U.S. companies, as well as the U.S. government and its foreign partners, need to work together more effectively to ensure that the illicit procurement schemes of sanctioned countries are detected and thwarted.     1 United States District Court of the Northern District of California, San Jose Division, Indictment, United States of America v. Evertop Services SND BHD, Amir Ghasemi, Majid Kakavand, and Alex Ramzi, Case No. CR 09-0357 RMW (HRL), Filed April 7, 2009. 2 Affidavit of Candace Kelly, Assistant U.S. Attorney, Northern District of California, in Support of Extradition of Majid Kakavand before United States Magistrate Judge, Northern District of California, April 20, 2009. 3 Angela Doland, “Engineer’s Arrest Exposes U.S. Pursuit of Iranians,” Associated Press.  January 22, 2010. 4  Affidavit of Todd Harris, Special Agent, United States Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, in Support of a Criminal Complaint and Arrest Warrant before United States Magistrate Judge, Northern District of California, March 6, 2009, p. 8. 5 Indictment, United States of America v. Evertop Services, p. 2. 6 Affidavit of Todd Harris, p. 10. 7 Indictment, United States of America v. Evertop Services, p. 5. 8 Affidavit of Clayton Wright, Special Agent, Immigration and Customs Enforcement, in Support of the Request for Extradition of Majid Kakavand before United States Magistrate Judge, Northern District of California, April 20, 2009, pp. 4-5. 9 Ibid, p. 5. 10 Ibid, p. 9. 11 Affidavit of Todd Harris, pp. 10-12. 12 Ibid. 13 Indictment, United States of America v. Evertop Services, p. 7. 14 “U.S. Slaps Broad New Sanctions on Iran,” Associated Press. October 25, 2007; UNSCR 1803 (2008), March 8, 2008, p. 4; Affidavit of Todd Harris, p. 16. 15 Affidavit of Candace Kelly, p. 5. 16 Affidavit of Todd Harris, pp. 15-22; Indictment, United States of America v. Evertop Services, p. 8-11. 17 Ibid. 18 Ibid. 19 Affidavit of Clayton Wright, pp. 21-22. 20 Affidavit of Todd Harris, pp. 22-23. 21 Affidavit of Todd Harris, p. 8. 22  “Iran Urges France to Free Engineer Wanted by U.S.,” Agence France Presse.  January 19, 2010. 23 “Engineer’s Arrest Exposes U.S. Pursuit of Iranians.” 24 Nasser Karimi, “Iran Says France Using Iranian’s Trial to Pressure,” Associated Press.  January 19, 2010. 25 “Engineer’s Arrest Exposes U.S. Pursuit of Iranians.”   Iran, Illicit Trade 2010-02-16T16:05:44+00:00 http://isis-online.org/isis-reports/detail/arrest-made-in-germany-of-core-iranian-procurement-agent/http://isis-online.org/isis-reports/detail/arrest-made-in-germany-of-core-iranian-procurement-agent/#When:16:04:14Z In early January 2010, German authorities arrested Amirhossein Sairafi, an Iranian suspected of illegally transshipping U.S.-bought items with nuclear applications from Dubai to Iran. 1  Sairafi allegedly ran a company with locations in Iran and Dubai called AVAC, through which he received shipments from an alleged Iranian operative in California, Jirair Avanessian, who has also been arrested in the case and charged with multiple U.S. export control violations.  The United States filed a criminal complaint against Sairafi, and also indicted the Iran-based recipient of the items, Farhoud Masoumian, but so far has not been able to locate him. Sairafi allegedly helped transship U.S. and foreign made vacuum pumps, valves, and other items bought from companies in the United States from AVAC in Dubai to Masoumian in Iran, who is suspected of working for customers affiliated with the nuclear program.  Sairafi helped change shipping labels to obscure contents and undervalue goods heading from the United States to Dubai.  The equipment was related to the operation of nuclear gas centrifuges and U.S. authorities suspect it was headed to Iran’s nuclear program. 2  Sairafi may have held a dual post as CEO or director of Command Co., Ltd in Iran, which claims to be a general trading company, through which he may have attempted to procure vacuum equipment from abroad. 3 The question of Sairafi’s extradition from Germany has not yet been decided, but this arrest shows that Iranian procurement operatives such as Sairafi, when they leave Iran on business or for other purposes, are subject to arrest and extradition to stand trial in the country whose laws they violate.  The United States and its foreign partners need to continue to be vigilant about working together to arrest these Iranian procurement agents.     1 U.S. Department of Justice Press Release, Office of Acting U.S. Attorney George S. Cardona, Central District of California, “Glendale Resident and Two Iranian Men Charged with Illegally Exporting Technology to Iran Without License,” January 13, 2010; Affidavit of Michael Barett Matten, Special Agent, Federal Bureau of Investigation, in Support of Complaint Against and Arrest Warrant for Amirhossein Sairafi before a U.S. Magistrate Judge, January 4, 2010. 2 Scott Glover, “Parts Sent to Iran Could Be Used for Nuclear Weapons Development,” The Los Angeles Times, January 14, 2010. 3 http://www.manufacturer.com/company/i6430880-Command+Co.,+Ltd..html ; http://ohabibi.en.ecplaza.net/; Affidavit of Michael Barett Matten, p. 28. Iran, Illicit Trade 2010-02-16T16:04:14+00:00 http://isis-online.org/isis-reports/detail/new-case-studies-on-the-iranian-illicit-procurement-efforts/http://isis-online.org/isis-reports/detail/new-case-studies-on-the-iranian-illicit-procurement-efforts/#When:15:29:13Z ISIS has released a capstone and four supporting case studies detailing recent efforts by the United States to arrest Iranians at the core of the Iranian regime’s smuggling efforts. The Iranian regime often acts as though it has a right to smuggle goods from abroad for its nuclear, missile, and conventional weapons programs.  Now that supplier states are increasingly seeking the arrest of its agents, Iran is insinuating that the detainment of British, French, and U.S. prisoners on charges of spying or fomenting political dissent in Iran is linked to arrests of smuggling suspects. The arrests of these Iranian agents supplement the imposition of United Nations Security Council sanctions on Iranian government entities and officials who lead military and nuclear projects that create the smuggling operations.  These approaches are complementary.  The sanctions block financial assets and the travel of key Iranians.  The arrest of Iranians directly tied to smuggling can harm Iranian procurement networks and deter others from pursuing these careers.  Adding these smugglers to the U.N. sanctions list could disrupt their operations. Read more of the capstone: Busting the Members at the Core of Iran’s Smuggling Networks for Nuclear, Missile, and Conventional Military Goods by David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Four Supporting Case Studies: Inventive U.S. Sting Operation Catches Iran-Based Military Equipment Smuggler David Albright, Paul Brannan and Andrea Scheel Stricker February 16, 2010 Former Iranian Ambassador Arrested in Britain for Allegedly Assisting Iran-Directed Smuggling Scheme David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Middleman Majid Kakavand Arrested for Allegedly Directing Malaysia-Based Iranian Illicit Procurement Scheme David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 Arrest Made in Germany of Core Iranian Procurement Agent David Albright, Paul Brannan, and Andrea Scheel Stricker February 16, 2010 2010-02-16T15:29:13+00:00 http://isis-online.org/isis-reports/detail/irans-gas-centrifuge-program-taking-stock/http://isis-online.org/isis-reports/detail/irans-gas-centrifuge-program-taking-stock/#When:14:49:39Z Table of Contents Understanding Enrichment at Natanz First Principles More advanced centrifuges coming? A secret site? Natanz and the P1 Centrifuge Separative Capacity of Iran’s P1 Centrifuge Building a Centrifuge Plant LEU Production Taking Stock, Analyzing FEP Performance Reasons for Sub-Optimal Performance Implications on the Fordow Enrichment Site Findings and Conclusion Figures and Tables Appendix: LEU Production Data 1. Understanding Enrichment at Natanz The Natanz Fuel Enrichment Plant (FEP) has now operated for over two years with several thousand IR-1 centrifuges.  Iran has enough centrifuges to produce a significant quantity of weapon-grade uranium, if it decided to do so.  Yet, it is far from being able to produce enough enriched uranium for a nuclear power reactor. It is natural to ask how well the IR-1 centrifuges are operating and to chart their performance.  But assessing what Iran has achieved at the FEP remains difficult because Iran reveals little centrifuge performance information to the International Atomic Energy Agency (IAEA), and the IAEA in turn reveals even less publicly in either its safeguards reports or during interviews.  Complicating any assessment, the public information has often been ambiguous or subject to subsequent revision.  Thus, the data contained in IAEA reports are not sufficient alone to answer many questions about Natanz’s progress. For example, every three months in its safeguards reports, the IAEA reveals the number of IR-1 centrifuges operating with uranium hexafluoride (UF6) on a given day.The inspectors do not however verify whether that number of centrifuges is actually producing low enriched uranium (LEU), or whether they receive enough information from Iran to determine the average number of centrifuges enriching during any extended period.  The absence of such information, which would incorporate data about breakdowns and maintenance, complicates any comparison of the FEP’s production of low enriched uranium to expected LEU output.  One useful measure of a plant’s enrichment output is to estimate the average enrichment output, or separative capacity, of an IR-1 centrifuge.  But doing this requires knowing the number of centrifuges actually enriching, the very value that is unreliable.  Similar problems confront other standard measures of enrichment performance.  Nonetheless, a comparative analysis of the FEP’s performance is possible. 2. First Principles It is useful to start by going back to the original purpose of the Natanz Fuel Enrichment Plant.  In 2006 Iran said publicly that the FEP would eventually hold 48,000 IR-1 centrifuges and produce 2,500 kilograms of low enriched uranium per month, enough to fuel a large nuclear power reactor 1.  Iran remains far from that goal, with 8,692 centrifuges installed as of November 2, 2009 but only 3,936 of these declared as enriching uranium on that day 2.  As discussed in more detail below, Iran’s monthly rate of LEU production remains below 100 kilograms per month.  With 18 percent of the planned centrifuges installed, Iran should be producing 450 kilograms of LEU per month.  Counting only those centrifuges reported as enriching and ignoring the rest, Iran should be producing at a rate of 200 kilograms of LEU per month. The problems at the FEP, particularly during the last year, appear to involve complications in deploying thousands of reliable centrifuges.  But despite these problems, it is important to remember that a centrifuge program is not unchanging or static; centrifuge development is intrinsically about improving the separative capacity of the centrifuges.  Iran will continue to improve its enrichment performance at Natanz and elsewhere.  It is certainly capable of achieving greater output from the IR-1 centrifuges. In addition, the IR-1 centrifuges are operating well enough to produce significant amounts of enriched uranium—enough for a nuclear weapon—if Iran is prepared to take account of a high centrifuge attrition or breakage rate by taking more time.  Iran could also compensate for the IR-1 centrifuge’s poor performance by simply using more machines to enrich uranium.  Overall, the time Iran would need to produce weapon-grade uranium, if it decided to do so, either through break-out or starting with natural uranium at Natanz, does not appear to have shifted significantly from earlier ISIS estimates, although Iran would need to use more centrifuges than assumed in these earlier estimates if at the time of breakout the centrifuge cascades were not performing better.  Moreover, Iran is already claiming one benefit of operating centrifuges, which is an achievement relatively few nations can boast.  For now, according to one European intelligence agency that ISIS queried, Iran appears content to demonstrate to the world that it can enrich, disregarding how well or poorly its centrifuges operate. 3. More advanced centrifuges coming? A secret site? Iran is developing more advanced centrifuges, for example the IR-2 modified, IR-3, and IR-4 centrifuges, which should exhibit better performance and reliability than the IR-1 centrifuges 3.  Iran is likely to try to deploy these more advanced centrifuges as quickly as possible, particularly at the Fordow enrichment site, near the city of Qom.  To do so, however, Iran must manufacture thousands of these centrifuges.  Its success will depend on whether it has imported, often via smuggling, adequate stocks of materials and equipment. Iran may also have other enrichment plants that house P1 centrifuges or advanced centrifuges.  The recent discovery of the Fordow site reinforces that possibility.  Perhaps, those centrifuges operate better at these undiscovered sites than at the Natanz site.  But Iran’s problems in getting its centrifuges to work at Natanz appear genuine.  In addition, the construction of centrifuge plants requires significant resources related to centrifuge component manufacturing and assembly.  Thus, it appears likely that Iran would have a difficult time successfully completing a secret centrifuge facility elsewhere while simultaneously working on the Natanz and Fordow enrichment plants.  But it is still possible that Iran could be building one now, while deploying centrifuges at the Natanz and Fordow plants.  During 2010, Iran may not have a significant enrichment capability, beyond the Natanz fuel enrichment plant, available for breakout using its existing stock of LEU or as a parallel effort starting with natural uranium. 4. Natanz and the P1 Centrifuge Iranian officials have steadfastly maintained that Natanz operates successfully and do not admit to any serious problems at the plant.  However, the relatively low LEU output suggests otherwise. Iran tries to focus on the positive; its officials periodically trumpet the growth in the number of centrifuges installed at the plant.  Figure 1 shows the steady increase in the number of installed IR-1 centrifuges, starting in February 2007.  It also charts an increase in the number of IR-1 centrifuges stated to be enriching uranium until June 2009, when the number started to decrease.  Iran has given no explanation for this significant decrease, although it reportedly said in August 2009 that it shut down a few cascades for maintenance 4.  According to a senior official close to the IAEA, the IAEA does not know the reason for the decrease.  Iran did acknowledge some technical problems in its centrifuges to the IAEA, but it did not volunteer why it reduced the numbers said to be enriching 5. Further confusing the situation, Iran’s current head of the Atomic Energy Organization of Iran (AEOI), Ali Akbar Salehi, stated in December 2009 that Iran is enriching in 6,000 centrifuges without any explanation 6.  The IAEA has not publicly confirmed this number as of early February 2010. The IR-1 centrifuge is commonly called the P1 centrifuge, for Pakistan-1, since it is a design that Iran acquired in the 1980’s and 1990’s from the A.Q. Khan network.  Khan had acquired this design illegally from the Dutch gas centrifuge program in the 1970s and built them in large numbers in the 1980s at the Kahuta enrichment plant in Pakistan.  Additionally, Iran is developing more advanced centrifuges based on a P2 design that Khan also illegally acquired in the Netherlands, deployed in large numbers in Pakistan, and subsequently passed to Iran in the 1990s. Iran would be expected to face many challenges in successfully operating the Natanz fuel enrichment plant.  Iran appears to have overcome the first challenge to successfully operate single P1 centrifuges or small P1 centrifuge cascades.  Iran has said that it accomplished this goal during a pilot stage of its enrichment program at the Kalaye Electric Plant and the Natanz Pilot Fuel Enrichment Plant.  Another challenge is to build and operate many centrifuges simultaneously, which is the current phase of Iran’s program.  It is in this phase where Iran appears to be encountering problems. Based on Pakistan and Libya’s experience, the P1 centrifuge is known to cause problems in developing countries trying to duplicate it, even with extensive expert foreign assistance.  For example, the P1 centrifuge experiences excessive vibration problems that can interfere with its operation, force its shutdown, or even cause it to break.  When the Dutch operated the P1-type centrifuge in the Urenco plant in the Netherlands in the 1970s, their centrifuges experienced higher failure rates than the centrifuges developed by their chief competitor, Germany.  This was one of the reasons why Urenco stopped using the Dutch designs and went ahead with the deployment of German centrifuges, such as those based on the G2.  Khan appreciated the value of the G2, and he stole this design as well and renamed it the P2 centrifuge.  Realizing the P1’s weaknesses, he tried to deploy this centrifuge as quickly as possible to replace his own P1 centrifuges. Iran appears to have inherited the operational problems in the P1 centrifuge.  To make matters worse, Iran cannot appeal to the Khan network for help.  The Khan network was stopped in 2004, making it impossible for Iran to draw upon Pakistani centrifuge experts for technical advice as it did in the 1990s and possibly the early 2000s.  But Iran may be seeking aid elsewhere. 5. Separative Capacity of Iran’s P1 Centrifuge Before evaluating the performance of the Fuel Enrichment Plant, it is important to look more closely at the P1 centrifuge.  Iran has publicly released few details of its P1 centrifuge.  From IAEA reporting, we know that the P1 is made out of four aluminum tubes connected by three maraging steel bellows, and a rotor assembly with a diameter of 100 millimeters.  In 2006, a senior Iranian nuclear official stated that the P1 is 1.8 meters long and its rotor has a peripheral speed of 350 meters per second 7. IAEA and western intelligence agencies report a lower peripheral speed.  A senior official close to the IAEA said in 2008 that the speed was only about 330 meters per second.  A knowledgeable intelligence official in 2007 quoted a value of about 335 meters per second and said that Iran was operating the P1 centrifuge at this lower speed to prevent its centrifuges from crashing.  As will be shown below, the lower value may be consistent with other statements by the head of Iran’s AEOI, despite his comment above about the speed being 350 meters per second 8. Neither the IAEA nor Iran has released detailed design information about the P1 centrifuge.  Nonetheless, a method for modeling the enrichment performance of the P1 centrifuge is based on publicly available information about a precursor of the P1 centrifuge.  In the 1960s, Gernot Zippe built the SSZ 100 9,  a duplicate of a centrifuge that he, along with Russians and other Germans, developed in Russia after World War II. 10  This centrifuge had a rotor made out of aluminum with a diameter of 100 millimeters, a length of 48 cm, and a rotational speed of 360 meters per second. 11  The length of the rotor involved in enriching uranium, called its separative length, was shorter, or 43.1 centimeters. A standard equation of the maximum possible separative capacity is: 12 δU(max) =  πDρZeff{∆Mv4/RT}, where Zeff  is the separative length of the rotor, ∆M is the difference in the molecular weights of the uranium isotopes uranium 235 and uranium 238, v is the peripheral velocity of the centrifuge, R is the gas constant, and T is the temperature in Kelvin.  Dρ is the product of D, the diffusion constant, and ρ, the total molar concentration.  At peripheral speeds achieved by aluminum rotors, the separative capacity increases with the fourth power of the velocity, but at higher speeds, the separative capacity increases more slowly than the fourth power of the velocity. The SSZ 100’s maximum possible separative capacity is 1.88 kg U swu/year 13.  This value is considerably higher than the value that can be achieved in an actual centrifuge.  It is customary to define the actual or experimental separative capacity as equal to δU(experimental) =  EδU(max), where E is the separative efficiency.  The maximum value of E is 0.4 to 0.5. 14  For the SSZ 100, the maximum separative capacity is 0.75-0.94 kg U swu per year. 15  During actual running of the SSZ 100, Zippe obtained a separation efficiency of 30 percent, or a separative capacity of 0.569 kg U swu per year. 16  He personally believed for this design, the maximum value achievable was 0.6 kg U swu per year.  17 The P1 can be represented as four stacked SSZ 100s, where the separative length would be 172 centimeters.  The total length of four SSZ 100s is too long, namely 192 centimeters, but almost 20 centimeters of this total length are not enriching, being above or below the enrichment zone of the centrifuge.  In the case of the P1 representation, which is taken as 180 centimeters long, the remaining eight centimeters are treated as sufficient to define the non-separation zone and include the extra length required for the bellows.  In any case, enrichment output, or separative capacity, increases linearly with length and can be adjusted easily if this length is too long.  The total error caused by this imprecision in the length should be relatively small. Under these assumptions, an estimate of the P1 centrifuge’s maximum possible separative capacity is 7.52 kg U swu/year and the theoretical achievable maximum separative capacity is about 3.0 to 3.76 kg U swu/year.  According to a former Urenco centrifuge expert, the maximum achievable separative capacity of the P1 is closer to 3.0 kg U swu/year. 18  Using Zippe’s 30 percent efficiency, an achievable value is about 2.26 kg U swu/year. Because the separative capacity of the P1 varies by the fourth power of peripheral velocity, a relatively small decrease in speed can translate into a significant decrease in separative output.  If the speed were 330 meters per second, as said by IAEA and western intelligence, the separative capacity of a P1 centrifuge would decrease by 30 percent to 1.6 kg swu per year.  Similarly, a speed of 350 meters per second would result in an estimated separative capacity of 2.03 kg U swu per year. Pakistan has revealed little information about its operation of P1 centrifuges.  However, a P1 design drawing given to Iran by the Khan network has handwritten on it the value of 2 kg U swu per year. 19 Houston Wood, a U.S. centrifuge expert at the University of Virginia, has performed a theoretical assessment of the P1 centrifuge, using a sophisticated model of centrifuge output. 20  He assumed a separative length of 1.8 meters and a peripheral speed of 350 meters per second.  He used the “pancake” code, so named because the uranium hexafluoride gas is smashed against the rapidly spinning wall like a pancake, and this model is more accurate than many other theoretical models of the complex behavior of the gas inside a centrifuge.  This model, which optimizes the centrifuge’s separative capacity, estimates 2.02 kg U swu per year, close to the estimate based on the SSZ 100 at this speed. Iran has provided conflicting information about the separative capacity they expect for the P1.  In a 2006 interview, Gholamreza Aghazadeh, then head of the Atomic Energy Organization of Iran (AEOI) gave two descriptions of the enrichment output of the P1 centrifuges. 21  He stated in this interview that each cascade, which contains 164 centrifuges, would be fed at a maximum rate of 70 grams of natural uranium per hour, with a ten percent product of 7 grams per hour of 3.5 percent enriched uranium.  He did not state whether the mass is LEU hexafluoride or contained uranium only.  Using a standard enrichment calculator, the ratio of product to feed combined with that enrichment level implies that the tails assay is 0.4 percent. 22  Because he stated these values a few weeks after Iran had first enriched uranium in a 164 centrifuge cascade at the Natanz pilot enrichment plant, these data are likely based mostly on the operation of single centrifuges and 10 and 20 machine cascades. 23  As such, they should be considered preliminary estimates. Nonetheless, using a standard enrichment calculator, an average centrifuge in this 164-maching cascade would produce about 0.92-1.36 kg U swu per year, where the lower value assumes the mass represents uranium hexafluoride and the larger value assumes the mass is only for the uranium. 24 Aghazadeh also implied in the interview that Iran expected to increase the P1’s separative capacity.  As discussed earlier, he said that Iran intended to build a large centrifuge plant of 48,000 centrifuges, what he called the industrial stage, which would produce 30 tonnes of LEU per year.  He did not explicitly list the enrichment level, but elsewhere he discusses using 3.5 percent LEU.  He does not state whether the mass of the LEU is in terms of LEU hexafluoride, LEU oxide, or uranium mass only.  Here, the value is assumed to be the mass of uranium hexafluoride or the uranium mass only, as above. 25  Using standard enrichment calculations, this amount of LEU would require about 74,000-108,960 kg U swu per year, assuming a tails assay of 0.4 percent.  Assuming that all the centrifuges are working as designed, an average centrifuge would produce 1.54 to 2.27 kg U swu per year, where the lower value is for uranium hexafluoride mass and the upper one is for uranium mass only. 26  If the LEU were in oxide form, the value would be between these two.  If Aghazadeh assumed that the enrichment level is higher or the tails assay lower, then the separative capacity would increase. 27  It is difficult to interpret Aghazadeh’s statements.  For example, how to assess the wide variation in the separative capacities in the two cases, e.g. 0.92 kg U swu per year vs. 1.54 kg U swu per year (where both are uranium hexafluoride mass).  Both are below values achieved in Pakistan and Europe.  But the Iranian value of 1.54 kg U swu per year is consistent with the rotor having a peripheral speed of only 330 meters per second.  The difference in these two values may reflect Aghazadeh’s view that the first one represents Iran’s initial expected achievement at the Natanz pilot plant and the second one includes later expected optimization of the P1 centrifuge, after Iran has accumulated additional operational experience.  Such an interpretation could make sense for a centrifuge program with a slow moving, struggling development effort. Table 1 summarizes the various estimated separative capacities for the P1 centrifuge.  Based on this analysis, an Iranian P1 centrifuge should be able to achieve 1.0-2.0 kg U swu per year.  Without actual data on operation, as was the case until Aghazadeh’s interview in 2006, estimates of 2-3 kg U swu per year are high but reasonable in worst-case analyses.  Because interpreting Aghazadeh’s information is difficult, these data are not sufficient to make definitive conclusions about the subsequent performance of Iran’s P1 centrifuge. 6. Building a Centrifuge Plan In 2005, toward the end of suspension in Iran’s gas centrifuge program, senior officials close to the IAEA believed that Iran would need to do considerable work to get cascades to work. 1  Few anticipated the level of problems Iran would experience.  Some of Iran’s own decisions appear to have worsened the FEP’s performance. In early 2007, Iran started bringing into operation cascades in the Natanz fuel enrichment plant.  The FEP has two large cascade halls, called production halls A and B.  Hall A is slated to hold 8 modules, units A21 to A28, each module containing 18 cascades, where a cascade contains 164 P1 centrifuges, for a total of 23,616 P1 centrifuges.  Each module has its own feed and withdrawal systems.  Information about Hall B is unavailable.  Iran has never publicly revealed its schedule for installing all these centrifuges. By early November 2007, Iran had finished installing all 18 cascades in the first module (A24) and declared that it was enriching uranium in all of them.  Figure 1 charts the growth in the number of centrifuges at the FEP.  Iran has also installed cascades in the A26 and A28 modules.  The decrease in the number of cascades said to be enriching has taken place in the A26 module, which reached twelve cascades enriching in June 2009 and decreased to six cascades enriching by November 2009.  Iran is also working on preparing modules A25 and A27 for installation of centrifuges. 7. LEU Production Figure 2  shows Iran’s LEU production, plotted in increments of monthly average production.  These values are derived from total LEU production during individual reporting periods that are detailed in IAEA quarterly safeguards reports.  The data in these reports are not always consistent and include subsequent revisions.  The data presented here are based on Iranian estimates supplemented by verified or corrected IAEA safeguards measurements, taken during the IAEA’s annual Physical Inventory Verification (PIV) at the FEP.  These data are explained in more detail in the appendix.  In addition, these data do not include the slightly enriched uranium in the dump tanks, which hold natural or slightly enriched uranium that is evacuated from cascades during unplanned centrifuge interruptions or breakage.  If this natural or slightly enriched material were purged into the product tank, it would dilute the product, which Iran wants to be at least 3.5 percent enriched. As can be seen, the average monthly LEU production rate rose steadily from 2007 to the summer and fall of 2008, when it reached about 90 kilograms per month.  In September 2008, a senior official close to the IAEA said that Iran was breaking its records for LEU production. 29 Sometime in late 2008 or early 2009, the LEU rate declined significantly to about 70 kilograms per month.  Afterwards, it rose slowly.  By November 2009, the LEU rate had increased to about 85 kilograms per month but with more cascades stated to be enriching than in 2008. The reason for this decline in 2008 is unknown.  That a problem is likely to have occurred is supported by the simultaneous increase in the number of centrifuges stated to be enriching.  One explanation for the decrease in the rate of LEU production is that Iran experienced unexpected difficulties as it tried to scale up significantly its operations in the fall of 2008.  The problems may not have been confined to only the A26 module where the number of cascades was increasing rapidly.  In November 2008, a senior official close to the IAEA said that the feed rate in the A24 module was remarkably lower than the design value, but he did not know the reason why. 30  But, as will be discussed later, a range of other difficulties may have also developed, ranging from sabotage to a variety of challenges associated with operating large number of centrifuges. Figure 3  plots the average monthly rate of introducing natural uranium hexafluoride into the centrifuge cascades.  Again, there is a drop in late 2008. Figure 4  compares the three sets of data.  It plots both the average monthly feed rate and LEU product rate, along with a mid-point of the number of enriching cascades in each reporting period.  The feed and LEU rates tend to go in tandem, as would be expected.  The drop in both the feed and LEU rate in late 2008 is clearly visible, as is a slow increase in monthly LEU production afterwards.  The figure also shows a sharp rise in feed after early 2009 and a steep decline afterwards.  A senior official close to the IAEA said in November 2009 that the feed rate had been low for some time.  The number of enriching cascades peaks with the feed values, which rise faster than the LEU values, suggesting that during 2009 a significant amount of the feed may not be ending up in the product tanks but instead in the dump tanks.  The IAEA has not publicly released the amount of material it measured in the dump tanks during its physical inventory verifications.  In recent safeguards reports it lists a combined amount in the tails and dump tank. 31  However, the IAEA has released the feed, product, and tails quantities measured in the 2008 PIV.  Table 2 summarizes these values.  As can be seen, the difference between feed and the product and tails is about 1,590 kilograms.  It is known that natural, enriched, and depleted uranium is “held-up” in equipment in the module.  In addition, natural uranium is in a uranium hexafluoride cleaning system at the front end of each module of cascades.  But the total amount of uranium inside the module would be expected to total about 500-550 kilograms, based on the IAEA’s subsequent publications of this difference in its more recent safeguards reports.  It is reasonable to assume that most of the rest of the 1,590 kilograms, or about 1,000 kilograms, was in dump tanks at the time of the 2008 PIV.  This material was slightly enriched, according to a senior official close to the IAEA.  Not all of it is recoverable, because at least some of the dump tanks also contain impurities deposited during the passivation process conducted before introducing uranium hexafluoride into cascades.  The IAEA does not provide its estimates of the separative capacity of the FEP.  A method to estimate these values is to start with the LEU product, where the slightly enriched uranium in the cascades’ dump tank is ignored. 34  To calculate the separative capacity, ISIS has used an enrichment level of 3.5 percent and a tails assay of 0.4 percent.  These choices are consistent with the available data.  Because the ratio of the feed to the product values in table 2 is about 10 to 1, after subtracting the 1,590 kilograms, the 2008 PIV suggests that the tails assay during this period was about 0.4 percent, where the product is taken as enriched to 3.5 percent.  The IAEA’s environmental sampling conducted inside the FEP also supports these conclusions. The results of these calculations are in Figure 5 , which shows the annualized separative work achieved in the IAEA’s reporting periods, excluding the separative work needed to produce the slightly enriched uranium in the dump tanks. Separative work has been near 2,500 kg U swu per year from May 8, 2008 until November 2009, except for a drop to about 2,000 kg U swu per year in the period from early November 2008 until February 2009.  Including the separative work in the dump tanks should not add more than about 10-20 percent to these estimates of the separative capacity.  During the period May 2008 until November 2009, the number of centrifuges that Iran said were enriching started at 3,280, climbed to 4,920 and then decreased to 3936.  During the period of the decrease in annualized separative work, early November 2008 until February 2009, 3,772 centrifuges were said to be enriching at the start of the period and 3,936 centrifuges were said to be enriching at the end of the period, an increase in the number of centrifuges while the separative capacity decreased.  Thus, the amount of average separative work produced at the FEP is not related in a straightforward manner to the number of centrifuges Iran declares are operating on particular days.  Calculating an average centrifuge output at the FEP is similarly difficult because of the lack of information about the average number of centrifuges actually enriching over a sustained period of time.  With centrifuges broken in cascades and cascades not operating properly, any such estimate must be viewed cautiously, likely as an underestimate. Despite the inherent problems in this type of estimate of average centrifuge separative capacity, for comparative purposes, Table 3 compares these values from 2007 until November 2009.  The values depend on the number of centrifuges enriching at the beginning and end of each IAEA reporting period.  Since the number of centrifuges enriching between these two dates is unknown, an average of these two values is not used.  In fact, caution has to be exercised in interpolating an average separative capacity in between two endpoints; the actual value could follow a complicated pattern.  But with this caution, the average separative capacities grew from slightly greater than 0.4 kg U swu per year to almost 0.8 kg U swu per year in late 2008 and then dropped to about 0.5 kg U swu per year.  The value at the end of 2009 was about 0.64 kg U swu per year.  However, as noted, these values could significantly underestimate the actual values or lead to inaccurate interpretations. Another indicator of performance, albeit cruder, is to compare the expected output from a reasonably-run plant of 4,000 P1 centrifuges to the FEP’s actual performance in enriching uranium.  This number of centrifuges is a rough approximation of the number operating from May 2008 until late 2009.  The expected separative capacity of the plant is calculated by multiplying this value of 4,000 centrifuges by an average separative capacity of a P1 centrifuge, which can be selected from Table 1, in this case 0.9-1.6 kg U swu per year, where the range captures three of the Iranian values in this table.  Thus, Iran should have been able to achieve a total output of 3,600-6,400 kg U swu per year. As derived earlier, Iran has achieved approximately 2,500 kg U swu per year.  One way to handle the uncertainty in the number of centrifuges enriching is to assign a capacity factor to the plant.  This value would account for the number of centrifuges that are malfunctioning or are broken.  Dividing the results, the capacity factor is 40 to 70 percent.  At first glance, the range of capacity factors appears poor.  However, based on Iranian technical and engineering capabilities, even the lower bound shows a significant accomplishment, given the difficulty of operating centrifuges. 8. Taking Stock, Analyzing FEP Performance The performance of Natanz’s fuel enrichment plant is difficult to assess with the available information.  Although the total separative capacity has remained near 2,500 kg U swu per year, the number of centrifuges installed or claimed to be enriching would suggest a larger separative capacity.  A simple picture of the plant is one where cascades are subject to frequent malfunction, centrifuges break often and need to be replaced, and feed values fluctuate up and down in unpredictable ways.  Even today, the FEP cannot be classified as a production plant; it remains a development facility, where Iran is struggling to learn to operate large numbers of cascades.  Nonetheless, Iran continues to put enormous resources into its centrifuge program.  There is no evidence of problems so severe that would prevent Iran from stockpiling more low enriched uranium or producing weapon-grade uranium, if Iran decided to do so.  Iran has an established capacity at the FEP large enough to produce in theory about 15-16 kilograms of weapon-grade uranium a year, using tails assays of 0.4-.0.5 percent and starting with natural uranium.  This is roughly enough to produce one nuclear weapon within a year and half to two years.  By using more of the centrifuges at Natanz, it could shorten this time estimate by half.  If Iran decided to use its sizeable stock of LEU as feed into its centrifuges, it could produce enough weapon-grade uranium for a nuclear weapon in less than six months. It is worthwhile to note that a choice of a tails assay of 0.5 percent, while it might appear high, reflects the experience of states seeking nuclear weapons, particularly in the early phases of their effort.  For example, during the first six to seven years of operation of the first U.S. gaseous diffusion plant at Oak Ridge dedicated to the production of highly enriched uranium for weapons, the tails assay was about 0.5 percent. 35  Similarly, the Y Plant, South Africa’s source of highly enriched uranium for nuclear weapons, had a tails assay of 0.5 percent during its first several years of operation, at which point the tails assay was reduced to 0.4 percent during the remainder of the plant’s operation. 36  The reason for such a high tails assay is straightforward to understand; speed is of the essence.  A larger tails assay leads to the production of more enriched uranium, and uranium is typically plentiful, at least to provide for a nuclear weapons program.  In contrast, a commercial program, which requires much larger amounts of uranium, would be incentivized to seek a lower tails assay.  It would consider a significantly lower tails assay as a result of a commercial optimization of the cost of uranium and separative work.  9. Reasons for Sub-Optimal Performance Over the years, ISIS has discussed the performance of the FEP with numerous officials in the IAEA, the United States, Europe, Israel, and other countries.  One common view is that Iran has moved too quickly to install centrifuges at the expense of developing competence in operating them reliably.  In the process, it has made many mistakes. Based on IAEA reporting, as mentioned earlier, Iran was expected to have significant problems in learning to operate P1 cascades.  The performance data show that Iran has experienced a painful learning curve. Recently, a European intelligence agency, in response to ISIS’s queries, stated that the FEP experiences a daily attrition of centrifuges through breakage.  In addition, the centrifuges are only sporadically loaded with uranium hexafluoride, implying that the FEP should not be viewed as a plant experiencing continuous enrichment in a specified number of cascades.  Rather, centrifuges and cascades continuously come and go out of operation. One senior western intelligence official told ISIS in October 2007 that Iran rushed to deploy centrifuges at the FEP, leading to mistakes that would eventually reduce centrifuge performance.  In the spring of 2006, according to this official, Iranian political leaders and leading enrichment technical experts met to plan out the centrifuge effort at FEP.  The scientists pledged to the political leaders that in a year they would reach a key benchmark at Natanz, suggested by this official to be the production of enriched uranium.  After a year and half, however, FEP had still not met that benchmark, according to this official, placing the Iranian technical experts under tremendous pressure to succeed.  This may help explain the rapid scale up in 2007 of the numbers of centrifuges at the FEP while the plant produced less then expected amounts of LEU. For a country such as Iran, facing sanctions, international scrutiny, exclusion from traditional suppliers and expertise, and possibly even an effort by foreign intelligence to sabotage the enrichment effort, there are many problems that complicate the building and operation of a centrifuge plant, any one of which could have degraded the performance of the centrifuges at the FEP.  There could be recurrent problems in manufacturing or assembling P1 centrifuges.  These problems may lead to centrifuges experiencing reduced enrichment output or even failing earlier than expected, in essence suffering a short operational lifetime.  For several years, governmental and IAEA experts have suggested that Iran might have experienced problems in making certain components, such as the rotor.  Older centrifuge components, many of which were made in the early 2000s, prior to the 2003 suspension of Iran’s enrichment program, could have been of lesser quality than newer parts.  In addition, assembling centrifuges requires care, and mass assembly of centrifuges can lead to mistakes that can lower the enrichment output of the centrifuge.  For example, the scoops must be precisely placed inside the rotor assembly of a centrifuge; a poor placement can significantly degrade its separative capacity.  The FEP might experience problems in sustaining a correct temperature gradient along the side of each centrifuge; this temperature gradient is critical to maintaining the expected separative capacity of a centrifuge.  The tubes spiraling along the outside of the P1’s outer casing carry water that regulates that temperature.  Perhaps, the water pumping system has been subject to variation and unable to maintain reliably the correct temperature along the side of the centrifuge. As discussed earlier, another unsolved issue may be excessive vibration in the P1 centrifuge that causes breakage or requires centrifuges to be taken off-line.  Iran might already be operating its centrifuges at a lower speed to reduce such operational instabilities, but perhaps even at reduced rotational speeds, it is still unable to control this problem. Iran might have on-going problems with the FEP’s elaborate computer system that monitors and controls the operation of the centrifuges.  Iran has tried to compensate for its lack of experience by operating its centrifuge plants using computer control systems that automatically obtain data from a wide variety of equipment. 37  In contrast, Urenco designed and operated its early centrifuge plants, such as ones involving G2 centrifuges, without computerized control or much measuring equipment, relying instead on its long-term experience with centrifuges.  Iran has instrumented its centrifuges to measure the pressure and temperature of the uranium hexafluoride gas, vibration of the rotor assembly, rotor speed, and the temperature of the cooling water.  38  This computer system controls all these measurements and any remedial actions, such as closing of valves to stop the flow of gas into an individual centrifuge experiencing excessive vibration.  Malfunctions in this computer system would be expected in the early phase of its operation. Finally, there remains the question of what happened in late 2008 or early 2009 that resulted in a significant lowering of LEU output.  Any of the above problems could have risen to a level that drastically cut LEU production.  In addition, an unknown event could have caused the drop.  A senior official close to the IAEA said in November 2008 that Iran had recently started to feed uranium hexafluoride that used uranium mined in Iran. 39  Iran has generally fed its cascades with uranium hexafluoride produced from yellowcake obtained from South Africa several decades ago.  Impurities in the domestically produced uranium may have damaged the cascades.  But Iran has enough uranium hexafluoride made from South African uranium that it would not need to use its domestically produced uranium for years. The New York Times has raised the possibility of sabotage. 40  Iran depends extensively on foreign, mostly illegal, procurements to outfit its gas centrifuge program.  It seeks vacuum pumps, vacuum measurement equipment, electronic subcomponents, high strength aluminum, magnets, and a wide variety of other equipment.  It is well known that the United States and European intelligence agencies have sought to place defective or bugged equipment into Iran’s smuggling networks.  Perhaps, some of this defective equipment caused damage at Natanz.  The problem may have been limited to module A26, which is the one that had the rise and fall in the number of enriching cascades.  However, the available information is not sufficient to determine whether the drop in LEU production occurred in only one module. A challenge for Iran is to develop competency in operating centrifuges.  By rushing installation and operation, Iran appears to have skipped a critical step in centrifuge development, namely operating a fixed number of cascades for an extended period.  For example, the Soviet Union, the first state to deploy large numbers of centrifuges, built a plant with 2,000-3,500 centrifuges in 1957.  It operated this plant for almost two years before deciding that a larger plant was technically feasible, at which point it accelerated its mass production of centrifuges.  Iran appears to have embarked on simultaneous mass production and deployment of P1 centrifuges, before it proved its technical competency to operate them.  Iran may have cut back enrichment operations in order to rectify its mistakes. Regardless of the technical difficulties, Iran has gained politically by rushing to install 8,700 P1 centrifuges.  Iran may have placed a premium on rapidly installing more centrifuges at the FEP, establishing facts on the ground, in case the regime decided to negotiate a freeze in its enrichment program.  How it manages to get all these centrifuges enriching bears close watching. 10. Implications on the Fordow Enrichment Site A related question is how well one can expect the Fordow enrichment plant near the city of Qom to operate.  Under a mountain, it is a deeply buried centrifuge facility that the IAEA reported is at “an advanced stage of construction” with “centrifuge mounting pads, header and sub-header pipes, water piping, electrical cables and cabinets” put in place but not yet connected. 41  In addition, “passivation tanks, chemical traps, cold traps and cool boxes were also in place but had not been connected.”  Inspectors also noted that a utilities building “containing electricity transformers and water chillers had also been erected.” But Iran had not installed any centrifuges as of November 2009.  Iran has provided conflicting information about the centrifuges it will install in the Fordow enrichment plant.  It told the IAEA that it intends to install about 3,000 IR-1 centrifuges in 16 cascades, or up to 187 centrifuges per cascade. 42  Later, the head of the AEOI said in December 2009 that Iran is making progress on its more advanced centrifuges and hopes to deploy them in early 2011, including at the Fordow plant. 43  If Iran installs P1 centrifuges, then how much weapon-grade uranium could the facility produce?  The underground facility is limited in size; with 3,000 centrifuges, the facility is crowded. 44  However, Iran could put centrifuges in other tunnels in the underground facility or pack in more centrifuges into the existing cascade area. 45  The first estimate assumes that Fordow will have 4,000 centrifuges and operate no better than the FEP has until late 2009.  In this case, the Fordow site could be compared to FEP, which achieved about 2,500 kg U swu per year, capable of making 15-16 kilograms of weapon-grade uranium per year, starting with natural uranium.  At this rate, Fordow could produce enough weapon-grade uranium for one nuclear weapon in a year or two, where a nuclear weapon is estimated to require from about 16 to 30 kilograms of weapon-grade uranium.  The weapon itself would require 15-25 kilograms of weapon-grade uranium and the rest represents losses during manufacture of the weapon components.  This range includes crude fission designs that require about 15-20 kilograms of weapon-grade uranium, and the Chinese warhead design A.Q. Khan gave Libya, and perhaps Iran, that utilizes almost 25 kilogram of weapon-grade uranium. But it is likely that Iran will improve the performance of the P1 centrifuges.  And it would be expected that P1 centrifuge performance would increase again by the time Iran would expect to operate the Fordow facility.  The greater number of centrifuges per cascade at the Fordow site may reflect a decision by Iran to better ensure that the amount of LEU product and its enrichment level is maintained at expected levels, while at any point a certain number of centrifuges in each cascade may not operate properly.  Another way to estimate Fordow’s output is to perform multiple calculations of the time needed to produce enough weapon-grade uranium for a bomb, resulting in a frequency distribution of estimates.  In this calculation, ranges of variables are derived based on current operation at the FEP and the above range of weapon-grade uranium needed to make a nuclear weapon.  In addition, this method provides an estimate of the amount of weapon-grade uranium Fordow could produce.  The former calculation is straightforward—the time to make enough weapon-grade uranium for one nuclear weapon is given as the product of the number of P1 centrifuges and the average separative capacity of a P1 centrifuge, divided by the product of the amount of separative work to produce a kilogram of weapon-grade uranium at a fixed tails assay and the amount of weapon-grade uranium per weapon.  The following ranges are used in this calculation: The site will have 3,000 P1 centrifuges in the first case and 4,000 centrifuges in the second case; Based on the earlier discussion, the average separative capacity is 0.5-1.0 kg U swu per year, although these choices may underestimate enrichment output of individual centrifuges; The tails assay is 0.5; 46  and The amount of weapon-grade uranium per weapon is taken as 16.5-30 kilograms, where the range used in 15-25 kilograms per weapon with the remainder representing losses in manufacturing the weapon. These calculations are performed using Crystal Ball software, which performs Monte Carlo calculations using the above ranges, where each value in a range is assumed equally likely.  Figure 6 is the frequency distribution of the values for the time required for the Fordow plant to produce enough weapon-grade uranium for one nuclear weapon in the case where 3,000 P1 centrifuges operate.  The median is 1.7 years; and the 5th percentile is 1.1 years and the 95th percentile is 2.7 years.  Including 90 percent of the values eliminates extreme values that occur infrequently.  It should be noted that these estimates do not include the extra time to fashion a nuclear weapon.  In terms of weapon-grade uranium production, the distribution has a median of 14 kilograms of weapon-grade uranium, where the 5th percentile is 9.7 kilograms of weapon-grade uranium and the 95th percentile is 18 kilograms. Figure 6  is the frequency distribution of the values for the time required for the Fordow plant to produce enough weapon-grade uranium for one nuclear weapon in the case where 4,000 P1 centrifuges operate.  The median is 1.25 years.  The 5th percentile is 0.8 years, and the 95th percentile is 2.0 years.  In terms of weapon-grade uranium production, the distribution has a median of 19 kilograms of weapon-grade uranium, where the 5th percentile is 12.9 kilograms of weapon-grade uranium and the 95th percentile is 24 kilograms. Improved operation of the P1 centrifuge would of course shorten the time necessary to make a nuclear weapon.  If at the Fordow plant the average separative capacity reaches 1.0-1.5 kg U swu per year, more in line with Iranian expectations in 2006, the time to make enough weapon-grade uranium for a nuclear weapon drops to a median of one year, with the 5th percentile at 0.7 years and the 95th percentile at 1.4 years. Based on other developing countries’ centrifuge programs, such improvements are likely. Overall, the results support the Obama Administration’s finding that Fordow is large enough to produce enriched uranium for a weapons program, if Iran opts to configure it for making weapon-grade uranium.  Its estimate that it would take Iran about one year to produce enough for a weapon would appear high based on a simple extrapolation of current performance of the Natanz fuel enrichment plant, i.e. 1 vs. 1.7 years.  However, it is reasonable to expect that Iran would improve the performance of the centrifuges or increase their numbers at Fordow, resulting in a production timeframe in line with the administration’s estimate. If Iran uses LEU as feed in the Fordow plant, the time to produce its first nuclear weapon would shorten significantly.  If the Natanz enrichment site makes 20 percent enriched uranium, and this material is used as feed in the Fordow plant or elsewhere, the time to make enough weapon-grade uranium for a weapon would shorten even more dramatically.  In addition, far fewer P1 centrifuges would be necessary, allowing for a smaller facility. 11. Findings and Conclusion Iran is likely to concentrate on increasing its LEU output at Natanz, improving operation of its centrifuges, and building the Fordow enrichment plant.  Now that Fordow is discovered, it could be planning or building another secret enrichment site.  Iran’s problems in its centrifuge program are greater than expected one year ago.  How much this has slowed Iran’s ability to make weapon-grade uranium is difficult to determine.  However, Iran has almost 9,000 centrifuges at Natanz and the ability to make many thousands more either at Natanz or elsewhere.  Despite the problems demonstrated at the FEP, Iran is unlikely to face significant delays in making weapon-grade uranium at Natanz, if it decided to build nuclear weapons.  Starting with natural uranium, Iran could likely still produce enough weapon-grade uranium for a nuclear weapon in a year; it could do so considerably faster if it started with its stock of already produced low enriched uranium.  But in 2010 Iran may be limited in its ability to produce weapon-grade uranium outside of the Natanz site, either in a breakout mode using its existing stock of LEU or in a parallel effort in a secret site starting with natural uranium. In the end, Iran can solve its centrifuge problems with time, either by improving the output of the P1 centrifuge or building more of them, or both.  In the medium term, it can also deploy more advanced centrifuges.  Given its announced plans to build ten more enrichment plants without notifying the IAEA about their location or status until six months before it introduces nuclear material, Iran’s capability to make weapon-grade uranium either in a secret parallel program or in a breakout is likely to grow with time. Iran’s progress at the FEP bears special watching to determine if Iranian technicians can overcome the plant’s problems and operate the centrifuges better.  Because of the importance of this issue to the international community, the IAEA should release more data about the FEP’s operation. Iran is expected to continue seeking equipment, materials, and technology abroad for its centrifuge effort.  Disrupting these efforts through increased vigilance on stopping illicit trade of dual-use materials and components can delay its centrifuge program and prevent the transfer of knowledge that could help Iran solve its problems in building and deploying not only the IR-1 centrifuge but more advanced ones as well. One can also expect more efforts by western intelligence services to place defective equipment in Iran’s centrifuge program.  Given that Iran acquires much of this equipment illegally, such efforts are hard to condemn.  However, predicting the impact of such efforts is impossible. The best way to constrain Iran’s enrichment program remains negotiations aimed at achieving a suspension of its program.  Iran is unlikely to deploy enough gas centrifuges to make enriched uranium for commercial nuclear power reactors for a long time, if ever, particularly if sanctions remain in force.  As such, one of the most striking lessons of reviewing Iran’s accomplishments at Natanz is just how unachievable a commercial enrichment program remains while how little is required to create a nuclear weapons capability.  While Iran may take longer than expected to make sufficient weapon-grade uranium for a bomb, few believe it will fail in that effort. 12. Figures and Tables Figure 1:  IR-1 (P1) centrifuges at the Natanz Fuel Enrichment Plant Figure 2:  Monthly average LEU production at Natanz Fuel Enrichment Plant during each IAEA reporting period, bar at midpoint of reporting period Figure 3:  Average monthly rate of introducing natural uranium hexafluoride into Natanz Fuel Enrichment Plant during each IAEA reporting period, bar at mid-point of reporting period Figure 4:  Comparison of Feed, LEU Product, and midpoint of number of cascades in each IAEA reporting period, point at midpoint of reporting period Figure 5: Anualized separative capacity in the Natanz Fuel Enrichment Plant during each IAEA reporting period, excluding slightly enriched uranium in the dump tanks, bar at midpoint of reporting period Figure 6:  Frequency distribution of estimates of the time for the Fordow plant to produce enough weapon-grade uranium for a nuclear weapon case, 3,000 P1 centrifuges and a tails assay of 0.5 percent Figure 7:  Frequency distribution of estimates of the time for the Fordow plant to produce enough weapon-grade uranium for a nuclear weapon case, 4,000 P1 centrifuges and a tails assay of 0.5 percent   1 Interview with Gholamreza Aghazadeh, then head of Atomic Energy Organization of Iran, “Iran’s Nuclear Chief Explains Nuclear Fuel Cycle, Comments on U.S. Concerns,” Network 2, April 12, 2006, translated from Persian.  Here, the mass is assumed to be LEU hexafluoride (see later for a more thorough discussion of this assumption. 2 IAEA Director General, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran, GOV/2009/74, November 16, 2009. 3 Ibid. 4 David Albright, Paul Brannan and Jacqueline Shire, “Natanz Enrichment Plant: How to Measure Progress,” September 1, 2009, http://isis-online.org/uploads/isis-reports/documents/Natanz_Centrifuge_Progress_1Sept2009.pdf. 5 Interview with senior official close to the IAEA, August 28, 2009. 6 Ali Akbar Dareini, “Iran Making New Model Centrifuges for Nuke Program,” Associated Press, December 18, 2009. 7 Interview with Gholamreza Aghazadeh, op. cit. 8 Interview with senior official close to the IAEA, May 28, 2008. 9 Zippe said that SSZ stood for both self-stabilizing centrifuge or for Steinbeck, Schefffel, and Zippe, the three principal German or Austrian developers of this centrifuge in Russia after World War II, interview, September 22, 1993. 10 Erwin Coester and Gernot Zippe, “Zur Berechnung von Idealen Zentrifugenkaskaden,” GKT, Julich, KFA Monographien B25979, February 11, 1968; and Albright, Frans Berkhout, and William Walker, Plutonium and Highly Enriched Uranium 1996: World Inventories, Capabilities and Policies (London: Oxford University Press, 1997). 11 A maximum speed of 400 meters per second is possible with aluminum rotors, but at speeds much above 360 meters per second, aluminum creeps reducing drastically the lifetime of the centrifuge. 12Coester and Zippe, op. cit.; and R.L. Hoglund, J. Shacter, and E. Von Halle, “Diffusion Separation Methods,” in Kirk-Othmer, Encyclopedia of Chemical Technology, volume 7, third edition, 1979. 13 Coester and Zippe, op. cit. 14 Ibid. 15 Ibid. 16 Ibid. 16 Ibid.; the temperature was 303 Kelvin or 30° centigrade. 17 Interview with Zippe, September 22, 1993. 18 Interview with former Urenco expert, 2005. 19Interview with a senior official close to the IAEA, 2004. 20 Houston Wood, “Analysis of the Proposed Gas Centrifuge Plant at Natanz,” Proceedings of the 48th Annual Meeting of the Institute of Nuclear Materials Management (2007). 21 Iranian television interview with Gholamreza Aghazadeh, op. cit. 22 See for example, http://www.wise-uranium.org/nfcue.html. 23 IAEA Director General, Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran, GOV/2006/27, April 28, 2006. 24 http://www.wise-uranium.org/nfcue.html. 25 The capacity of the uranium conversion facility at Esfahan is 200 t of uranium in uranium hexafluoride per year or 300 tones of uranium hexafluoride per year.  This capacity would suggest that Aqadazah was using uranium hexafluoride mass or expected the output of the uranium conversion facility to increase. 26 A 100 percent capacity factor is assumed for the plant. 27  A lower tails assay would conserve uranium resources.  With a tails assay of 0.3 percent, and assuming that all the centrifuges are working as designed, an average centrifuge would produce 1.83 kg U swu per year in the case of the mass being uranium hexafluoride.  28 Interview with senior official close to the IAEA, January 12, 2005. 29 Briefing by senior official close to the IAEA, September 15, 2008.  The feed rate was close to the 70 gram per hour per cascade stated by Aghazadeh in April 2006 as Iran’s goal. 30 Interview, November 19, 2008. 31 IAEA Director General, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran, GOV/2009/74, November 16, 2009;  IAEA Director General, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran, GOV/2009/55, August 28, 2009. 32 Communication from the IAEA, February 2009. 33 Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran, GOV/2009/74, November 16, 2009;  IAEA Director General, Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran, GOV/2009/55, August 28, 2009. 34 There is not enough information to include in the calculations the slightly enriched uranium in the dump tanks. 35 Frank von Hippel, David Albright, and Barbara G. Levi, “Quantities of Fissile Materials in U.S. and Soviet Nuclear Weapons Arsenals,” PU/CEES 168 (Princeton, New Jersey: Princeton University, Center for Energy and Environmental Studies, July1986), citing Thomas B. Cochran, William M. Arkin, Robert S. Norris, and Milton M. Hoenig, Nuclear Weapons Databook, Volume 11: The Production Complex (Cambridge, Massachusetts: Ballinger Publishing Company, 1987). 36 Y Plant operational logs, in graphical form. 37 Interview with senior European official, August 2009. 38 Interview with Aqazadah, op. cit. 39 Senior official close to the IAEA, November 19, 2008. 40 David E. Sanger and William J. Broad, “U.S. Sees an Opportunity to Press Iran on Nuclear Fuel, The New York Times, January 2, 2010. 41 IAEA Director General, Implementation of the NPT Safeguards, November 16, 2009, op. cit. 42 IAEA Director General, Implementation of the NPT Safeguards, November 16, 2009, op. cit. 43 “Iran Making New Model Centrifuge for Nuke Program,” op. cit. 44 Interview with senior official close to the IAEA, December 30, 2009. 45 Ibid. 46 The effect is negligible of using a range of 0.4-0.5%, instead of a fixed value of 0.5%. Iran 2010-02-11T14:49:39+00:00