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In a stunning revelation that has reignited public anger over state corruption in Iran, Babak Zanjani — once sentenced to death for masterminding one of the country’s largest embezzlement scandals — has resurfaced as a key player in a multibillion-dollar rail investment project backed by the Iranian Ministry of Roads and Urban Development.
On April 20, Iran’s state-run media and leaked social media posts briefly revealed that a 64 trillion toman (approximately $800 million) contract was signed between the Islamic Republic of Iran Railways and a private firm tied to Zanjani. The deal includes the production of hundreds of railcars and locomotives in a project officially hailed by Masoud Pezeshkian’s government as a major leap in national infrastructure.
But critics argue it is instead a stark reminder of the deep entanglement between Iran’s most corrupt oligarchs and the ruling elite.
Delving into Iran’s #Corruption Chronicles – Part 1https://t.co/3uRDWFAqxD
— NCRI-FAC (@iran_policy) December 21, 2023
From Death Row to Economic Savior?
Zanjani, who was arrested in 2013 and convicted in 2015 of “spreading corruption on earth” — a capital offense in Iran — was found guilty of embezzling nearly €2 billion through a vast web of fraud involving fake bank documents, money laundering, and oil smuggling. Initially sentenced to death, his punishment was quietly commuted to 20 years in prison last year, reportedly with the direct approval of Supreme Leader Ali Khamenei.
Now, barely a year after the commutation, Zanjani is allegedly reaping profits from government infrastructure deals. According to registry documents unearthed by Iranian media, Zanjani was appointed CEO of the “Avan Group for Financial and Economic Development” — the parent company of the contracting firm “Avan Rail” — in March 2025. This directly contradicts official denials by company representatives, who claim Zanjani is not a shareholder but merely provides financial “support.”
The Islamic Republic of Iran Railways, in an unusually defensive statement, insisted the 64,000 billion toman agreement is entirely privately funded and that Zanjani’s name does not appear in official documentation. The railway organization emphasized that no government budget would be used and that its role is limited to regulatory oversight.
Regime's Dual Exchange Rate System Fueling Massive Corruption in #Iranhttps://t.co/AOVqQsT5v2
— NCRI-FAC (@iran_policy) March 17, 2025
The regime’s justification? That Zanjani’s foreign assets have now been “recovered and repatriated” for use in domestic projects — a claim many observers view with deep skepticism.
A Symbol of Iran’s “Mafia Capitalism”
Zanjani’s role as a middleman for the regime’s sanctions-evasion schemes during Mahmoud Ahmadinejad’s presidency earned him both Western sanctions and insider status. U.S. and EU authorities blacklisted him in 2013 for helping Tehran skirt oil sanctions.
He was celebrated by Iranian officials at the time, even receiving awards from figures such as former presidents Akbar Hashemi Rafsanjani and Mohammad Khatami, until the internal factional rivalries of the regime turned against him.
Yet his apparent return, complete with a state-endorsed infrastructure deal, underscores how Iran’s economy remains dominated by politically connected elites, despite decades of anti-corruption rhetoric from both conservative and so-called reformist factions.
In #Iran, Oil Rigs Can Disappear in Tin Airhttps://t.co/7402V8KdWI
— NCRI-FAC (@iran_policy) October 7, 2023
Zanjani is now widely seen not just as a symbol of financial corruption, but of a kleptocratic system where impunity is the rule — provided one stays loyal to the clerical regime.
The Real Message: Power Over Justice
For many Iranians, the Zanjani affair confirms what they’ve long suspected: in the clerical dictatorship, justice is arbitrarily applied, and loyalty to the system outweighs all legal accountability.
As protests continue across Iran over poverty, repression, and state violence, the quiet rehabilitation of one of the regime’s most infamous economic criminals may well fuel more rage on the streets. For now, Zanjani’s billion-dollar resurrection is more than a scandal — it’s a cautionary tale about the lengths Iran’s rulers will go to protect their own.