Just as a leech draws blood from its host, senior executives at Iran’s largest steel company sucked the country’s mining sector for all they could in a multi-billion dollar corruption scandal that tied them to widespread fraud, bribery, and money laundering.
In a scathing 296-page parliamentary report published in 2024, Iranian lawmakers lifted the lid on one of the country’s most significant industrial scandals in recent memory. The focus of the investigation? Mobarakeh Steel Company (MSC), the largest steelmaker in the Middle East and North Africa, responsible for nearly 15 percent of Iran’s domestic revenue and boasting exports to over 38 countries. But behind the gleaming façade of industrial might lies a sordid tale of fraud, nepotism, and institutional failure.
Over a 19-month period, Iran’s Parliament uncovered how senior MSC officials abused their authority to embezzle billions of dollars, misappropriate public funds, and manipulate market mechanisms. The repercussions of this scandal are profound, both economically and politically, with implications that stretch far beyond Iran’s borders.
This investigation reconstructs the anatomy of the MSC corruption case — a story of unchecked power, systemic loopholes, and the cost of compromised governance in a country grappling with sanctions, economic hardship, and political unrest.
A Giant Built on Steel and Secrets
Mobarakeh Steel Company, based in Esfahan province, is more than just an industrial titan — it’s a national symbol. With over 3,000 factories under its management and privileged access to Iran’s estimated 57 billion tons of metal reserves, MSC represents the beating heart of the country’s non-oil economy.
According to data from the parliamentary report, MSC contributed nearly 15 percent of Iran’s total revenue last year alone. Its output supplies crucial material for the construction, automotive, and defense sectors. Moreover, Iran’s ambitious export policy saw MSC’s steel reach more than three dozen countries, defying economic sanctions and asserting the Islamic Republic’s economic relevance on the global stage.
However, this economic engine was running on more than steel — it was also fueled by layers of mismanagement and covert financial practices.
A Web of Corruption
The parliamentary committee’s findings paint a grim picture of institutional decay. Under the leadership of CEO Hamidreza Azimian and his senior team, MSC engaged in practices that included the fabrication of contracts, funneling of funds through shadow companies, and illegal profiteering through preferential deals.
One of the most egregious violations involved under-the-table agreements with Iranian automakers. MSC executives were found to have sold steel products at below-market prices, only to pocket the price differential in offshore or private accounts. These arrangements were not isolated incidents — investigators uncovered a systematic pattern of corruption that cost the company, and by extension the Iranian public, trillions of rials.
Furthermore, the company hired hundreds of individuals who either lacked qualifications or simply did not exist. These ghost employees were granted hefty salaries and benefits, often exceeding those of real employees. Investigators believe this scheme served as a money-laundering operation and a means of enriching insiders and political allies.
The Invisible Ledger
What made the MSC case particularly difficult to crack was the absence of transparent record-keeping. Auditors struggled to obtain documentation for many of the company’s major expenses, which were disguised under vague budget categories such as “miscellaneous corporate incentives” or “external consultancy.”
Among the fraudulent expenses identified were lavish bonuses for senior executives, international travel packages, and falsified government contracts. According to the report, some of these expenses appeared intentionally structured to avoid detection, using layers of bureaucratic complexity to obscure the true recipients.
Documents that did come to light suggest that MSC’s leadership never intended for their transactions to be traceable. One internal memo, obtained by the parliamentary committee, warned executives to avoid digital correspondence when discussing “sensitive” financial arrangements.
Who Guards the Guardians?
While MSC is a private entity on paper, its operational oversight falls under the Iranian Mines and Mineral Industries Development and Renovation Organization (IMIDRO), a state-run body. This hybrid model of private profit and public responsibility created the perfect storm for regulatory evasion.
Senior officials at IMIDRO have so far denied direct involvement, but investigators suggest otherwise. Some IMIDRO representatives were found to be beneficiaries of MSC’s fraudulent contracting system. A handful of senior bureaucrats even acted as intermediaries between MSC and other state-owned enterprises to facilitate favorable deals.
Moreover, the failure of government watchdogs to detect or prevent this scale of corruption has raised serious concerns about the efficacy of Iran’s anti-corruption framework. Critics argue that overlapping jurisdictions, political interference, and a culture of impunity have rendered these mechanisms toothless.
Economic and Political Fallout
The scandal’s revelation sent shockwaves through Iran’s financial markets. Within hours of the report’s release, the Tehran Stock Exchange suspended MSC’s trading. “Until we have clarity on the company’s financial standing, it is in the public’s best interest to halt all MSC transactions,” said Mahmoud Goudarzi, the exchange’s chief executive.
Industry analysts warn that this scandal could trigger a ripple effect. MSC’s contracts are deeply interwoven with numerous downstream industries. A disruption in MSC’s operations could, in theory, stall construction projects, automotive production, and infrastructure development, compounding Iran’s already fragile economy.
Politically, the scandal couldn’t have come at a worse time. With inflation soaring and public dissatisfaction growing, the government now faces mounting pressure to demonstrate accountability. Calls for Azimian’s arrest and the prosecution of other senior executives have grown louder, but so far, no formal charges have been filed.
Whistleblowers and Silenced Voices
One of the report’s more unsettling revelations was how whistleblowers were treated. At least three former MSC employees who attempted to raise red flags were allegedly threatened or forced to resign. One internal auditor, whose testimony was included in the report, claimed to have received anonymous death threats after requesting access to financial logs.
Human rights organizations in Iran have expressed concern over the increasing criminalization of whistleblowing. In a country where press freedom is already limited, the MSC case may further dissuade future disclosures of corporate wrongdoing.
“What we’re seeing is not just a financial scandal — it’s a warning sign for anyone who wants to expose corruption in Iran,” said a spokesperson for the Center for Human Rights in Iran.
What Comes Next?
The parliamentary committee has recommended the establishment of a specialized anti-corruption tribunal to oversee MSC’s case. Whether this tribunal will be independent or simply a political gesture remains to be seen.
In the meantime, the government has announced stricter oversight protocols for companies operating in the mining and metallurgical sectors. These include mandatory third-party audits, greater disclosure requirements, and limits on executive compensation.
However, critics argue that unless there is a genuine commitment to transparency and legal reform, these measures are unlikely to prevent future misconduct. “The MSC scandal is not an isolated incident,” said Dr. Farzaneh Moini, an economist at Tehran University. “It reflects a systemic failure in how Iran manages its national assets.”
A Cautionary Tale of Industrial Power Gone Rogue
The Mobarakeh Steel Company scandal is more than a story of corporate greed — it is a case study in how opaque governance, political patronage, and weak oversight can transform a national asset into a liability. For a country struggling under international sanctions and internal strife, the consequences of this corruption extend far beyond financial losses.
As Iran’s lawmakers, media, and citizens grapple with the fallout, the fate of MSC remains uncertain. What is clear, however, is that the company’s future — and perhaps the integrity of Iran’s broader industrial sector — will depend on whether this moment becomes a turning point or just another forgotten scandal.
Only time will tell if Iran can forge accountability out of the wreckage of Mobarakeh’s empire of steel and deceit.