(S) RESPONDING TO GERMAN REQUEST FOR INFORMATION

S E C R E T SECTION 01 OF 04 STATE 077660

SIPDIS

E.O. 12958: DECL: 07/18/2033
TAGS: PARM PREL ETTC MTCRE KSCA GM IR AEC
SUBJECT: (S) RESPONDING TO GERMAN REQUEST FOR INFORMATION
ON THE ICS SCHNEIDER - SBIG TEST CHAMBER CASE

REF: A. 05 STATE 201650

B. 05 BERLIN 3726

C. 05 STATE 211408

D. 05 BERLIN 3954

E. 06 STATE 36325

F. 06 BERLIN 674

G. 06 STATE 62278

H. 06 BERLIN 1123

I. 06 STATE 70328

J. 06 BERLIN 1229

K. 06 BERLIN 1550

L. MTCR POC 201/2006 - MAY 16 2006

M. 07 STATE 75839

N. 07 BERLIN 1137

O. 07 STATE 108420

P. 07 BERLIN 2163

Q. 07 STATE 166482

R. 07 BERLIN 2216

S. STATE 15220

T. BERLIN 195

U. BERLIN 511

V. BERLIN 643

W. STATE 40087

Classified By: ISN/MTR DIRECTOR PAM DURHAM FOR REASONS
1.4 (B),(D).


1. (U) This is an action request. Please see
paragraph 9.


2. (S) Background: Since November 2005, we have
worked with German authorities to prevent Iran's solid
propellant missile developer - the Shahid Bakeri
Industrial Group (SBIG) - from procuring environmental
test chambers from the German firm ICS Schneider
Messtechnik (Schneider) (Refs). On April 24, German
MFA Export Control Division Desk Officer Wiebke Wacker
advised post that the German Customs Office of Criminal
Investigation (Zollkriminalamt, or ZKA) has been
conducting an investigation into ICS Schneider and its
head, Andreas Schneider, on the basis of USG-provided
information (Ref U). Wacker has requested information
on two specific issues related to this case: 1)
conversations between U.S. officials and an Iranian who
has been working as the middleman in the ICS Schneider
- SBIG test chamber case; and 2) evidence that
Schneider was aware that the intended end-user of the
test chamber was SBIG.


3. (S) Wacker inquired about information concerning an
Iranian who may have been "detained" at an undisclosed
U.S. embassy (Ref V). The Germans believe this Iranian
has information linking Andreas Schneider (of ICS
Schneider Messtechnik) with Iranian procurement agents
and said that ICS Schneider dealings with Iranian
procurement agents went off-line when this individual
was "arrested." Wacker gave no further details other
than to say that the Iranian in question had applied
for a U.S. visa. In subsequent meetings, Wacker
identified the Iranian visa applicant as Abdolmajid
Naji. (Note: Naji represents the Iranian company
Rakin, a firm that has been acting as an intermediary
between Schneider and SBIG front companies in the
environmental test chamber case. End note.) According
to Wacker, Naji was confronted (and possibly detained)
by U.S. authorities in February 2008 while applying for
a visa in Dubai. Wacker said that the ZKA is seeking
evidence needed to support its investigation of
Schneider, and is interested in information concerning
any conversations U.S. officials had with Naji.


4. (S) Wacker also advised that German investigators
are interested in knowing whether the USG has any
information indicating that Andreas Schneider was aware
that the Iranian firm Shahid Bakeri Industrial Group
(SBIG) would be the actual end-user of the
environmental test chamber.


5. (S) Next Steps/Naji: We want to advise German
officials that while Abdolmajid Naji did come to the
U.S. Consulate General in Dubai in early 2008 to apply
for a visa, he was not detained or arrested by U.S.
officials. We also want to advise German officials
that, during the visa application process, Naji was
interviewed at AmConGen Dubai, and indicated that he

STATE 00077660 002 OF 004


planned to visit his pregnant daughter in the U.S.
Additionally, Naji stated that he is married with four
other children (who live in Iran),and that he owns a
private equipment company with his wife and earns
$1,000,000 per month. However, on April 27, Naji
withdrew his visa application for unknown reasons.


6. (S) Next Steps/Schneider: We want to respond to
the German request for any information indicating that
Schneider knew that the intended end-user of the test
equipment was SBIG. In the substantial volume of
information we have provided to Germany on this case,
we have not shared any information specifically
indicating that Schneider ever dealt directly with
SBIG, or even knew that SBIG (or the Iranian ballistic
missile program) was the end-user. In an April 21,
2008 non paper provided to German authorities, the U.S.
identified SBIG as the actual intended end-user of the
test chamber, but noted that SBIG had been using front
companies (Aban Commercial and Industrial Group, Saba
Machinery Supplying Company, and Pooya Commercial and
Engineering) in its efforts to procure the equipment
from Schneider (Ref W). Moreover, Schneider's primary
interlocutor in these procurement efforts was Rakin,
the intermediary, and not SBIG or its front companies.
It is therefore conceivable that Schneider never knew
that SBIG was the actual intended end-user.


7. (S) However, it is clear that Schneider
representatives were aware that they were engaged in
questionable - if not illegal - trade. This is
evidenced by the fact that at least three different
Iranian entities were identified by Rakin as the end-
user of the test equipment. When we first began
discussing this case with Germany (November, 2005),the
purported end-user was Aban Commercial and Industrial
Group (Ref A). By March 2006, the end-user had changed
to Saba Machinery Supplying Company (Ref E). Based on
information provided by the U.S., German authorities
denied Schneider an application to export the test
chambers to Saba in May, 2006 (Refs K & L). After the
denial, Rakin began listing Pooya Commercial and
Engineering as the end-user (Ref M). Even if Schneider
was unaware that Aban, Saba, and Pooya were all front
companies used by Iran's ballistic missile program, we
would expect that a legitimate supplier would have
raised questions - if not terminated the deal outright
- in a case where three different entities were listed
as the end-user for the same equipment in such a short
time.


8. (S) Moreover, after the issuance of the May 2006
denial, Schneider began scheming with Rakin to route
the equipment through a firm in a third country -
eventually settling on the Croatian firm Belmet 97 - in
order to disguise the fact that the actual end-user was
in Iran (Ref M). We believe that Schneider may have
been preparing to submit another export license
application - listing Belmet 97 as the end-user - but
according to German authorities, Schneider never did
so. As of December 2007, Rakin's Naji was still
negotiating with Schneider for the sale of the test
chamber, so we do not believe that the equipment was
shipped to Iran via Belmet 97 (Ref Q). Further, as of
January 2008, Schneider and Rakin were working to send
the test chambers to Iran via yet another third country
entity - the UAE's Edib Oil General Trading - while
falsely listing an entity in Tajikistan as the end-user
(Ref S).


9. (S) Action Request: Department requests Embassy
Berlin approach appropriate host government officials
to deliver talking points in paragraph 10 responding to
German MFA Export Control Division Desk Officer Wiebke
Wacker's request for information related to the ICS
Schneider - SBIG test chamber case. Post should also
request from German officials an update on the current
status of the investigation.


10. (S) Begin talking points/non-paper:

(SECRET//REL GERMANY)

--Since November 2005, we have been discussing with
you efforts by Iran's Rakin Ltd. to procure
environmental and temperature shock chambers from the
German firm ICS Schneider Messtechnik on behalf of
Iran's missile program.

--On April 24, 2008, you advised us that the German

STATE 00077660 003 OF 004


Customs Office of Criminal Investigation
(Zollkriminalamt, or ZKA) has been conducting an
investigation into ICS Schneider and its head, Andreas
Schneider, on the basis of USG-provided information.

--You also requested information on two specific issues
related to this case: 1) conversations between U.S.
officials and an Iranian who has been working as the
middleman in the ICS Schneider - SBIG test chamber
case; and 2) evidence that Schneider was aware that the
intended end-user of the test chamber was the Iranian
solid-fueled ballistic missile entity Shahid Bakeri
Industrial Group (SBIG).

--With regard to the first issue, you recently inquired
about information concerning an Iranian who may have
been detained by U.S. officials in Dubai, where he was
applying for a visa.

--Specifically, you indicated an interest in learning
of any conversations U.S. officials had with Abdolmajid
Naji, a representative of Rakin Ltd., the firm that has
been acting as an intermediary between Schneider and
SBIG front companies in the environmental test chamber
case.

--While Abdolmajid Naji did come to the U.S. Consulate
General in Dubai in early 2008 to apply for a visa, he
was not detained or arrested by U.S. officials.

--During the visa application process, Naji was
interviewed and indicated that he planned to visit his
pregnant daughter in the U.S.

--Naji also stated during the interview that he is
married with four other children (who live in Iran),
and that he owns a private equipment company with his
wife and earns $1,000,000 per month.

--Naji provided the following information in his visa
application: Address: 69 Manoochehr Hossein Nia St, 12th
Street, Kargar Shomali, Tehran, Iran. E-mail:
rakin@dpimail.net. Home phone: 0098 21 88633576; work
phone: 0098 21 88012892.

--On April 27, Naji withdrew his visa application for
unknown reasons.

--Note: The information derived from Naji's visa
application may not be further disseminated. If you
wish to share this information with a third party
please make a request through the Embassy to the U.S.
Department of State.

--In response to your question about ICS Schneider
Messtechnik's possible knowledge of the fact that SBIG
was the actual intended end-user of the test equipment,
we have the following to share:

--We do not at this time have any information
indicating that Schneider ever dealt directly with
SBIG, or even knew that SBIG (or the Iranian ballistic
missile program) was the end-user of the products ICS
Schneider was intending to export to Iran. Schneider's
primary interlocutor in these procurement efforts was
Rakin, the intermediary, and not SBIG or its front
companies.

--However, it is clear that Schneider representatives
were aware that they were engaged in questionable - if
not illegal - trade.

--For example, at least three different Iranian
entities were identified by Rakin as the end-user of
the test equipment: Aban Commercial and Industrial
Group, Saba Machinery Supplying Company, and Pooya
Commercial and Engineering.

--When we first began discussing this case with you
(November, 2005),the purported end-user was Aban
Commercial and Industrial Group.

--By March 2006, the end-user had changed to Saba
Machinery Supplying Company. Based on information
provided by the U.S., your export control authorities
denied Schneider an application to export the test
chambers to Saba in May 2006.

--After the denial, Rakin began listing Pooya
Commercial and Engineering as the end-user.

STATE 00077660 004 OF 004


--Even if Schneider was unaware that Aban, Saba, and
Pooya were all front companies used by Iran's ballistic
missile program, we would expect that a legitimate
supplier would have raised questions - if not
terminated the deal outright - in a case where three
different entities were listed as the end-user for the
same equipment in such a short time.

--In addition, after the issuance of the May 2006
denial, Schneider began scheming with Rakin to route
the equipment through a firm in a third country -
eventually settling on the Croatian firm Belmet 97 - in
order to disguise the fact that the actual end-user was
in Iran.

--As of January 2008, Schneider and Rakin were working
to send the test chambers to Iran via yet another third
country entity, the UAE's Edib Oil General Trading,
while falsely listing an entity in Tajikistan as the
end-user.

--Note: Please be advised that we have not told UAE
authorities that we have shared the information about
the UAE company with you. If you wish to share this
information with a third party, please make a request
through the U.S. Embassy.

--While we cannot provide you with direct evidence that
Schneider was aware that SBIG was the end user, this
information clearly indicates a pattern of deception
and knowledge that the equipment's intended end-use
would have been problematic to German export
authorities.

--We hope this information is helpful in supporting
your investigation. We will continue to provide
additional information on this case as it becomes
available.

-- We look forward to future cooperation on
nonproliferation matters and would appreciate hearing
any updates on the progress of your investigation of
this case.


11. (U) Please contact ISN/MTR's John Paul Herrmann
with any questions or follow-up related to this case
(202-647-1430 - herrmannjp2@state.gov or
herrmannjp@state.sgov.gov) and slug reporting on this
issue for ISN/MTR, EUR/CE (Tom O'Keeffe) and EUR/PRA
(Matt Hardiman).
RICE