US puts sanctions on former Afghan parliament speaker and his family for corruption

Contract Inflation

A. Rahmani and M. Rahmani used their hidden control of numerous companies to artificially inflate fuel contract prices by fraudulently submitting contract bids from multiple companies that obscured their involvement, rigging bids, and eliminating competition on U.S.-funded contracts. For example, in 2014, several families involved in the fuel business, including the Rahmanis, colluded to drive up the price of fuel on U.S.-funded contracts by more than $200 million and eliminate competitor bids.

Import Tax Fraud

The Afghanistan Customs Department was responsible for regulating the importation of dry goods and fuel for North Atlantic Treaty Organization (NATO), U.S., and Afghan forces using “maffinamas,” letters that allowed the holder to import a limited amount of goods tax free. These maffinamas were supposed to be cross-referenced with orders and delivery receipts to ensure that only allotted quantities were imported tax free. Representatives for Rahmani fuel companies repeatedly gave cash to Afghan Customs officials in what were seen as bribes for excess maffinamas.

In one such case, A. Rahmani received maffinamas for more than double the quantity of fuel authorized for a given delivery. In 2017 and 2018, one of the Rahmanis’ companies imported almost 1 billion liters of fuel—an amount greater than the total ANDSF annual consumption (estimated at 400 million liters), despite only supplying a minority of the fuel task orders during those years to the ANDSF.

After the cancellation of one of the Rahmanis’ company’s contract to supply aviation fuel to the ANDSF in early 2019, the company imported an additional 2.5 thousand metric tons of aviation fuel tax free. Fraudulent use of maffinama certificates by the Rahmanis is estimated to have potentially robbed the Afghan government of millions of dollars in tax revenue.

Fuel Theft

The Rahmanis further bolstered their corrupt fuel profits by under-delivering on their companies’ fuel contracts. One of the Rahmanis’ fuel companies, Secure Movement Logistics (SML),bribed Afghan National Army (ANA) personnel to conceal their non-delivery of fuel, allowing at least 11 million liters of fuel to go undelivered in less than a year.

Parliamentary Corruption

Ahead of the October 2018 parliamentary elections, A. Rahmani gave potential voters gifts and money in exchange for their promise of a vote and promised additional compensation after the election if he received their vote. To ensure his election to the Afghan Parliament, A. Rahmani paid $1.6 million to some members of the Afghan Independent Election Commission to inflate the results of the election by thousands of votes.

M. Rahmani paid millions of dollars to multiple Members of Parliament throughout the parliamentary speakership elections in 2018 to secure their votes for his bid for Speaker of Parliament.

A. Rahmani and M. Rahmani are being designated pursuant to E.O. 13818 for being foreign persons who are current or former government officials, or persons acting for or on behalf of such an official, who are responsible for or complicit in, or have directly or indirectly engaged in, corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery.

CITIZENSHIP BY INVESTMENT

Corrupt officials, like the Rahmanis, acquire and utilize foreign citizenships to conduct business around the world. Citizenship by investment (CBI) programs are intended to attract foreign investment by granting foreign investors citizenship rights, and the associated identification documents, in the country concerned—without requiring prior residency by the applicant. While many CBI applicants may engage with these programs for legitimate reasons, corrupt actors often abuse CBI programs and their benefits (such as passports) to hide assets, facilitate illicit cross-border activity, and access previously inaccessible areas of the international financial system. These actions can undercut anti-money laundering and countering the financing of terrorism (AML/CFT) regimes.

Rahmani family yet to comment on this issue.