Prominent figure indicted for torture claims and criticism of Leader

Earlier in the week, Politico reported that an Iranian entity paid hackers $3 million in ransom to dissuade them from releasing the data of over 20 hacked banks, confirming Iran International’s earlier report about the “biggest-ever” cyberattack on Iran’s banking system.

Iran International reported on August 14 that the major cyberattack targeted several Iranian banks, leading to the theft of a huge amount of data. Initial assessments indicated at the time this could be one of the largest cyberattacks ever against Iranian state infrastructure, even though Iranian officials kept mum about the revelation.

In its report on Wednesday, Politico wrote that the cyberattack targeted 20 of the 29 active credit institutions in Iran, threatening the stability of the Islamic Republic's banking system. The report said it appears to be the “worst cyberattack” against the country.

Citing unnamed sources, Politico noted that the group “IRLeaks” which has a history of hacking Iranian companies, is likely behind the cyberattack.

“IRleaks entered the banks’ servers via a company called Tosan, which provides data and other digital services to Iran’s financial sector,” the officials told Politico. “Using Tosan as a Trojan horse, the hackers appear to have siphoned data from both private banks and Iran’s central bank... The regime ultimately forced Tosan to pay the IRLeaks ransom.”

The report said the affected banks included “the Bank of Industry and Mines, Mehr Interest-Free Bank, Post Bank of Iran, Iran Zamin Bank, Sarmayeh Bank, Iran-Venezuela Bi-National Bank, Bank Day, Bank-e Shahr, Eghtesad Novin Bank, and Saman, which also has branches in Italy and Germany.”

The same hacker group, IRLeaks, had earlier in December 2023 claimed responsibility for a cyberattack on Snapp Food, the country's largest food delivery app, boasting access to the personal details of over 20 million users, and exposing a vast trove of sensitive information.

The compromised data, reportedly up for sale at $30,000, included usernames, passwords, email addresses, full names, and mobile numbers. The hackers claimed to possess detailed information on over 51 million user addresses, complete with GPS coordinates and phone numbers.

In that case, too, ransom money was paid to dissuade the hackers from releasing the personal data of Iranian users.

Also in September 2023, the hacking group reported a breach on the ride-hailing service Tapsi, affecting more than 33 million users. The hackers claimed to have engaged in negotiations with Tapsi's management for two weeks before making the breach public. However, the company refused to meet the hackers' demand of $35,000.

The recurrent nature of such incidents in Iran highlights the absence of stringent laws and penalties for negligence in safeguarding private information.

The lack of user rights, including the inability to request the deletion of personal data, underscores the urgency for regulatory reforms to address the growing threat of information leaks in the country.

The officials, members of the Supreme Council of the Stock Exchange, orchestrated the generous loans with lenient repayment periods and minimal interest rates while Iran’s economy remains on the brink of collapse.

Majid Eshghi, Chairman of the Board of the Securities and Exchange Organization, received the largest loan, 27 billion rials ($45,000), with just 4% interest over a 10 year period. To put this amount in perspective, and ordinary worker in Iran earns just $200 a month.

The loans were approved during the final days of the Raisi government, bypassing orders from both acting president Mohammad Mokhber and president-elect Masoud Pezeshkian. Experts warn that the move threatens to destabilize Iran’s capital market by further eroding investor confidence.

Other council members, including Alireza Nasserpour, Reza Eivazlou, Mehrdad Masoudifar, and Hassan Farajzadeh Dehkurdi, each received 19 billion rials (over $31,000) in loans.

On Thursday, Abdolnasser Hemmati, Iran’s Minister of Economy, announced the launch of an “urgent expert review” into the scandal. Many view this as a mere formality, with little expectation of accountability in a system where officials have long shielded themselves from public scrutiny.

Iman Aghayari, a political activist, told Iran International that corruption in Iran has evolved into a kleptocracy, becoming ingrained as a behavioral model. “At the top, there is a person [Ali Khamenei] who treats the entire country as his personal property, and at the lower levels, others believe they must plunder the limited resources available to them," he said.

Iran’s Central Bank is already under fire for reports of astronomical loans being granted by major banks to their own employees and subsidiaries. According to a report released by the Central Bank last week, these institutions funneled over 9,100 trillion rials ($1.5 billion) in loans to their employees, managers, and board members in 2023 alone.

Two of the most politically influential banks, Mellat and Sepah, are the lead suspects, both notorious for their involvement in Tehran’s military and nuclear programs, which have brought crippling international sanctions upon Iran. Mellat Bank alone issued 190 trillion rials ($315 million) in loans to its subsidiaries last year, with Sepah Bank not far behind, distributing 145 trillion rials ($240 million).

Not only are these government banks controlled by regime insiders, but their subsidiary companies also serve as strongholds for political appointees and nepotism.

In contrast, ordinary Iranians face challenges securing loans for housing, marriage, or entrepreneurship, with delays and denials becoming the norm. Marriage loans, crucial for thousands of young couples, have been sidelined, while bank employees are handed fortunes with ease.

The disparity in access to loans is vast between Iran's elite and the ordinary citizen. For bank employees, loan ceilings can reach over 10 billion rials ($16,000), while retirees, struggling to survive on meagre pensions, are limited to loans of just 300 million rials ($500). Meanwhile, tenants and entrepreneurs face long waiting lists as banks cite financial shortfalls.

Around one in three Iranians now lives below the poverty line as inflation has exceeded 40% for the last five years leaving many struggling with basic costs such as food and housing.

The tools, supported by the US-backed Open Technology Fund (OTF), have seen a surge of usage in Russia, Iran, Myanmar and authoritarian states that heavily censor the internet.

OTF's pitch to tech companies at the meeting was to help offer discounted or subsidized server bandwidth to meet the fast-growing demand for virtual private network (VPN) applications that OTF funds, the organization’s president, Laura Cunningham, told Reuters.

“Over the last few years, we have seen an explosion in demand for VPNs, largely driven by users in Russia and Iran,” Cunningham said. “For a decade, we routinely supported around nine million VPN users each month, and now that number has more than quadrupled.”

VPNs help users hide their identity and change their online location, often to bypass geographic restrictions on content or to evade government censorship technology, by routing internet traffic through external servers outside of that government’s control.

The US government launched its first Internet blockage circumvention tool in 2009 when the Iranian government expanded its censorship during anti-government protests. Later, the OTF was created to oversee and coordinate the US government’s Internet anti-censorship effort, annually receiving around $15 million in mid-2010s.

Iranians have long been the biggest users of the US-provided and other VPNs, since thousands of websites and all major social media applications are blocked by the government both for political and religious purposes.

The OTF specifically backs VPNs that are designed to work in states that restrict access to the internet. The U.S. injected increased funding into VPNs supported by the OTF following Russia’s invasion of Ukraine in 2022, Reuters reported at the time.

The organization has since received a boost to its budget from the US State Department via its “Surge and Sustain Fund for Anti-Censorship Technology”, an initiative created at the Biden administration’s Summit for Democracy.

But it has struggled to meet increased demand in countries like Russia, Myanmar, and Iran, where internet censorship heavily restricts access to outside information.

Around 46 million people a month now use US-backed VPNs, Cunningham said, but added that a sizeable chunk of the budget was taken up by the cost of hosting all that network traffic on private sector servers.

“We want to support these additional users, but we don't have the resources to keep up with this surging demand,” she said.

Representatives of Amazon Web Services, Google, and Microsoft did not immediately respond to a request from Reuters for comment.

A Cloudflare spokesperson said the firm was working with researchers to "better document internet shutdowns and censorship."

With reporting by Reuters

Senator Chuck Grassley released whistleblower information from FBI records amid Trump’s latest presidential bid and in the wake of a failed assassination attempt against Trump just weeks ago, which Iran denied links to.

In a statement, Grassley said: ”Bad actors are determined to wreak havoc on our country, and American political leaders across both parties are sitting squarely in the crosshairs.

“In this extraordinarily heightened threat environment, federal agencies ought to be laser focused on building up public trust and reassuring the American people of their efforts to carry out their protective missions."

He vowed he will not "stop pressing for answers until Congress and the American people are afforded the transparency they deserve.”

Asif Merchant, a Pakistani with known ties to Iran, has been charged for his involvement and according to the FBI documentation, provided evidence to the FBI in a plea deal. He was arrested just one day before the July assassination attempt.

According to the FBI records, Merchant believed he was in for a kill-for-hire scheme that would offer him a cut of $50,000 for successful completion. He had told FBI interrogators that there were options for shooting former President Trump at both indoor and outdoor speaking engagements.

The Pakistani, 46, told investigators that he could hit a target up close or from further away, that a pistol would be best for indoors, but a rifle was necessary otherwise. He is said to have believed he had about a 50% chance of success.

English language notes were smuggled by Merchant’s family members to communicate with his handlers in Iran.

While the FBI has still not commented on the July assassination attempt on Trump by Thomas Matthew Crooks, while investigations continue, the option of it having been an Iranian plot has not been ruled out.

Security had been increased in June based on intelligence suggesting plots to kill him as Iran continues to vow revenge for Soleimani, killed in a drone strike in Iraq in 2020, ordered by Trump for his involvement in terror targeting US troops.

According to the justice department's indictment, Merchant arrived in the US from Pakistan in April after having spent time in Iran, when he contacted someone he thought would help him enact the plot. The unnamed contact reported him to the authorities.

Merchant had apparently told the contact he would leave the US before the killings, staying in contact only through code words.

FBI director Christopher Wray called the scheme a "dangerous murder-for-hire plot... straight out of the Iranian playbook".

Last year, the US listed Iran as the world's number one state sponsor of terrorism while plots to kill dissidents, Israeli and Jewish targets around the world have become increasingly more common.

Demanding transparency from security agencies, Grassley said that a DHS-FBI briefing from earlier this week "yet again failed to provide full transparency, necessitating this letter and the public disclosure of the unclassified proffer.”

Kayhan and its managing editor, Hossein Shariatmadari, began attacking Pezeshkian even before his cabinet was finalized. Shariatmadari criticized the president's selection of ministers early on, targeting his choices before they were officially confirmed. He went further, accusing Pezeshkian of appointing aides and vice presidents who he labeled "political criminals" and supporters of "seditionists" — a term referring to those who backed popular protests.

A report on Etemad Online website on Wednesday suggested that Hossein Shariatmadari has undergone a "factory reset," returning to his familiar tactic of launching destructive attacks on the president and his administration. The report followed Shariatmadari’s accusation that the Pezeshkian administration has deviated from its commitment to Khamenei’s ideals.

Under Shariatmadari, Kayhan has worked hard to present itself as a media outlet closely aligned with Khamenei’s views. However, this portrayal is not entirely accurate, as other newspapers, such as Ettela'at, Jomhouri Eslami, and Khorasan, are also financially and editorially linked to Khamenei’s office yet maintain different editorial perspectives. This diversity of viewpoints among pro-Khamenei outlets highlights a complex media strategy by the Supreme Leader.

In several reports Iranian journalists and politicians pointed out that what Kayhan writes solely reflects Shariatmadari's ideas and biases rather than reflecting Khamenei's views. Others believe that the paper has a function of being the ‘attack dog’ for Khamenei’s court.

According to Etemad Online, Kayhan's attacks on Pezeshkian seem particularly strange given Khamenei’s favorable stance toward the new president and his cabinet. In recent instances, Khamenei has personally shown support for figures like Vice President Zarif and Health Minister Zafarghandi, who were both targets of Shariatmadari's harsh criticism. This disconnect between Kayhan's hostility and Khamenei's approval raises questions about the motivations behind the newspaper's stance.

The Kayhan whose line of thought often resembles those of ultraconservative Paydari Party pretended that the Pezeshkian administration faces no financial shortages. This was refuted by the President during an interview with the state TV in which he said his government had no funds in the Treasury and he had to borrow money from the National Development Fund to start his work.

In summary, Kayhan's opposition to the Pezeshkian administration centers on several key issues: Shariatmadari's criticism of Pezeshkian's decision to reinstate academics and students dismissed for supporting the 2022 protests, his objections to the appointment of Abbas Araghchi as Foreign Minister and the inclusion of former officials like Javad Zarif in the cabinet, and his negative views toward two reformist-leaning ministers. This broad opposition reflects Kayhan's discontent with Pezeshkian’s choices.

In another report on Wednesday, Etemad Online quoted reformist activist Mohammad Reza Jalaipour, who refuted Kayhan's claims, stating that neither Khamenei's Office nor the IRGC have plans to confront the Pezeshkian administration. He emphasized that the new government is a result of a "win-win" collaboration between the executive branch and Khamenei’s office. Jalaipour expressed optimism about the government's future, noting the Supreme Leader's support.

Meanwhile, an online campaign is calling for Shariatmadari’s resignation, suggesting he’s "tired after 30 years of hard work."