The Real Deal New York

Iranian nonprofit to court: Don’t seize full value of 650 Fifth

Alavi asks that forfeiture be limited to 11.4% of building
By Kathryn Brenzel | July 12, 2017 08:00AM

650 Fifth Avenue and Supreme Leader of Iran Ali Khamenei

The Alavi Foundation doesn’t think it should lose its full stake in 650 Fifth Avenue: On Tuesday, the nonprofit asked a federal court to limit the forfeiture to 11.4 percent of the building’s value.

In a letter to a Manhattan Federal Court judge, Alavi’s Attorneys Asked That The Court set aside the jury’s June verdict, which paved the way for the federal government to seize its 60 percent stake in the 36-story office tower. Last month, the jury found that Alavi was controlled by Iran and laundered money through its partnership with the Assa Corporation, a shell company for an Iran-controlled bank. Alavi claimed that it wasn’t aware of Assa’s connections to Iran post-1995, when the U.S. imposed sanctions against the country.

Alavi argues in its letter that any proceeds it received in relation to controlling 650 Fifth for Iran are limited to management fees. The forfeiture awarded in June’s verdict is “excessive and grossly disproportional to the offense,” Alavi’s attorneys write. The building is valued at over $500 million.

The letter asks that the court set aside the jury’s verdict or order a new trial. Prosecutors have asked for three weeks to respond to Alavi’s motions.

Federal authorities first tried to take control of the building in 2008. In 2014, they reached a deal to seize both Alavi and Assa’s stakes in the office tower. But in July 2016, a federal appeals court found that prosecutors hadn’t proven that Alavi knowingly partnered with Iran.