On March 24, 2016, the court dismissed a motion on the part of the Khavaris to have Mizrahi return shares of five corporations held by Mizrahi, ruling "Khash has transferred all of his rights of ownership in the Shares to MEI [Mizrahi].

Khavari has claimed 105 million Canadian dollars in damages. Khavari also violates Canada’s Anti-Terrorism Act and Part II.1 (Section 83.55). He may face the death penalty if convicted by the judicial system of Iran.

Toronto property records in Khavari’s name date to 2001, when he took out a mortgage for a $615,000 property on Elmwood Avenue., in North New York At one time, Khavari owned a Toronto-based company called Soaring Properties.

On October 31, 2011, House of Commons of Canada member Irwin Cotler called for investigation on how he became a Canadian citizen.

In February 2014, the head of the Interpol Office of Iranian police said “a few days ago, the Canadian Interpol claimed in a phone contact that he has escaped to a Latin American or Caribbean country but that they couldn"t verify the escape yet, and this is the latest piece of information provided by the Canadian police to us”.

Khavari was once the owner of Soaring Properties, a Toronto-based business. Canadian authorities refused to extradite Khavari despite numerous requests from Iranian police. Khavari shortly after went to United Kingdom in order to attend a meeting at Lloyd Bank and announced his resignation by faxing it to Iranian officials on Tuesday, September 27, 2011.

In his resignation letter, Khavari implicated another bank as the source of the fraud and claimed that he was resigning in order “to respect public opinion,” according to Bloomberg.

He moved to Canada, where he has citizenship, and signed his 3-million dollar house in Bridle Path, Toronto over to his daughter, to protect it from possible seizure by Canadian authorities.

According to security expert, Avi Jorisch, Khavari is in violation of the Special Economic Measures (Iran) Regulations for having worked and provided financial services on behalf of a designated Canadian entity. If convicted by Iran’s judicial system, Khavari could face the death penalty.

He was chairman of Bank Melli Iran until September 2011 and chairman of Bank Sepah’s board of directors from December 2003 until at least March 2005.

In February 2014, the head of the Interpol Office of Iranian police said “a few days ago, the Canadian Interpol claimed in a phone contact that he has escaped to a Latin American or Caribbean country but that they couldn’t verify the escape yet, and this is the latest piece of information provided by the Canadian police to us”.

Ahmadinejad appointed him as chairman of the Board and managing director at Bank Melli Iran in 2010. Khavari shortly after went to United Kingdom in order to attend a meeting at Lloyd Bank and announced his resignation by faxing it to Iranian officials on Tuesday, September 27, 2011.

Height, Weight & Body Measurements

Mahmoud Reza Khavari height Not available right now.

Khavari is a Toronto property record holder. Furthermore under Section 83.05, Canadian authorities have the right to freeze Khavari’s assets. In this case, bogus documents facilitated the diversion of roughly $2.6 billion across multiple banks, including Bank Melli, through collusion between executives and private actors, such as steel magnate Mahafarid Amir-Khosravi, underscoring how interconnected state-private networks exploit verification gaps.^[27] Non-performing loans, exacerbated by such practices, hovered around 15% of total portfolios in state banks by the early 2010s, reflecting chronic undercapitalization and tolerance for unrecovered credits to cronies rather than commercial viability.^[28]Parallel shadow banking operations, often IRGC-orchestrated to circumvent sanctions and formal channels, further erode transparency and amplify fraud risks by diverting funds outside audited systems.^[29] While international sanctions intensified isolation and evasion tactics post-2011, domestic corruption predates them, as evidenced by Transparency International's 2011 Corruption Perceptions Index ranking Iran 120th out of 182 countries, signaling entrenched patronage that shields high-level perpetrators from swift accountability.^[22] These factors collectively enabled the scale of the Bank Melli fraud, illustrating how politicized incentives and institutional frailties transform routine lending into avenues for embezzlement.

Legal Proceedings

Resignation and Immediate Aftermath

Mahmoud Reza Khavari resigned as managing director of Bank Melli Iran on September 27, 2011, amid allegations of his involvement in a $2.6 billion embezzlement scheme that had recently come to light.^[30][13] The move followed the arrests of several senior bank executives linked to fraudulent letters of guarantee totaling approximately 3,000 billion Iranian rials, issued to a single trading company, which exposed systemic vulnerabilities in state-controlled lending practices.^[18][21]The resignation triggered immediate political fallout, heightening criticism of President Mahmoud Ahmadinejad's administration for oversight failures in Iran's banking sector and contributing to calls for accountability among economic officials.^[13] Concurrently, the head of Bank Saderat, Mohammad Jahromi, was also removed from his position in connection with the scandal, signaling a broader purge of implicated banking leaders.^[21] Iranian media and officials emphasized the fraud's scale as one of the largest in the country's history, prompting vows of rigorous prosecution to restore public trust in financial institutions.^[30]In the days following, judicial authorities accelerated preliminary investigations into the embezzlement's mechanics, focusing on unauthorized fund transfers and insider collusion at Bank Melli, while Khavari's abrupt exit raised questions about potential evasion of responsibility.^[18] The Central Bank of Iran moved swiftly to appoint an interim replacement to mitigate operational disruptions, underscoring the scandal's threat to national economic stability amid international sanctions.^[13]

In Absentia Trial and Sentencing

In November 2017, Mahmoud Reza Khavari was tried in absentia by Tehran's Revolutionary Court for his role in the 2011 embezzlement scandal involving approximately $2.6 billion from Bank Melli Iran.^[31][3] The proceedings, overseen by Judge Moosa Ghazanfarabadi, focused on charges including disruption of Iran's economic, monetary, and banking systems through fraudulent activities, bribery, and illegal property acquisition.^[32][33]On December 9, 2017, Khavari was convicted and sentenced to a total of 30 years in prison: 20 years for economic disruption and an additional 10 years for bribery.^[33][34] Each of the primary charges also carried a fine of $3 million.^[35] The verdict remained subject to appeal, with Tehran's chief justice noting in January 2018 that Khavari retained the right to challenge it.^[36] Iranian authorities emphasized the sentence's basis in documented fraud, including the use of bogus documents to secure credit lines, though enforcement was complicated by Khavari's residence in Canada, which has declined extradition requests citing lack of a treaty and potential political motivations.^[3][16]

Extradition Requests and International Complications

Iran issued formal extradition requests for Khavari shortly after his flight to Canada in September2011, following the exposure of the multibillion-dollar embezzlement scandal at Bank Melli Iran.

By 1985, these experiences positioned him for transfers to other state banks, marking the transition from junior legal roles to broader managerial responsibilities.

Appointments Under Ahmadinejad Administration

In 2010, Mahmoud Reza Khavari was appointed by the administration of President Mahmoud Ahmadinejad as chairman of the board and managing director of Bank Melli Iran, the country's largest state-owned bank.^[11][12] This role placed him at the helm of an institution handling significant portions of Iran's international financial transactions, amid the administration's efforts to consolidate control over key economic sectors.^[13]The appointment drew internal opposition, including from Iran's Ministry of Intelligence, which reportedly viewed Khavari's selection unfavorably due to his background and dual Iranian-Canadian citizenship—a factor criticized in domestic press for compromising security in a position of national importance.^[14][15] Despite these concerns, the Ahmadinejad government proceeded, reflecting preferences for loyalists in banking leadership during a period of heightened economic sanctions and internal political maneuvering.^[3] No other major appointments for Khavari under the administration are documented prior to this role, following his earlier tenure at Sepah Bank during the preceding Khatami presidency.^[16]

Role as Head of Bank Melli Iran

Mahmoud Reza Khavari held the position of chairman of the board and managing director of Bank Melli Iran, the Islamic Republic's largest state-owned commercial bank, from 2005 to 2011.^[17] He was appointed to this role by President Mahmoud Ahmadinejad following his prior tenure as chairman of Bank Sepah from 2003 to 2005.^[17][3] As head of the institution, Khavari oversaw daily operations, credit extensions, and financial services amid Iran's state-dominated banking sector, where Bank Melli managed significant portions of government-related transactions and domestic deposits.^[1]During Khavari's leadership, Bank Melli operated under escalating international sanctions, including U.S.

Treasury designations in June 2007 for purportedly facilitating transactions linked to Iran's nuclear and missile programs, which restricted the bank's access to global financial systems.^[18] The bank maintained branches abroad and pursued strategies to sustain cross-border activities, though specific initiatives under Khavari's direct oversight remain sparsely documented in public records beyond routine management.

These works reflect his pre-resignation focus on aligning Iranian banking law with Islamic principles and practical regulatory challenges, though their reception post-scandal has been limited in official circles.