At least 19 people have now been arrested in an alleged US$2.6 billion letter of credit (L/C) fraud that has shaken the government of Iranian President Mahmoud Ahmadinejad (Fraud, 13 September 2011).

Several of the Islamic Republic's most senior bankers may also now have been removed or resigned.

Death penalty

Those arrested in this alleged scam are accused by the judiciary of involvement in the fraudulent opening of L/Cs by an investment group owned by Amir Mansour Arya, who is connected to one of Ahmadinejad's closest aids, Esfandiar Rahim Mashaei.

Prosecutor General Gholamhossein Mohseni-Ejei has said that those found guilty of fraud may be executed.

Bank casualties

Reports from Tehran suggest that the Central Bank of Iran has been ordered to remove the heads of Bank Saderat and Bank Saman.

The head of Iran's biggest bank, state-owned Bank Melli, has reportedly already tendered his resignation.

Iranian lawmakers are also threatening to impeach economy minister, Shamseddin Hoseyni.

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