MALAYSIAN-BASED FRONT COMPANY FOR IRANIAN

S E C R E T STATE 104467 SIPDIS E.O. 12958: DECL: 10/07/2034 TAGS: ETTC PARM PREL MTCRE MNUC KS MY IR SUBJECT: MALAYSIAN-BASED FRONT COMPANY FOR IRANIAN PROCUREMENT AGENT SEEKS U.S.-ORIGIN EQUIPMENT FROM SOUTH KOREAN FIRM (S) Classified By: ISN/MTR DIRECTOR PAM DURHAM FOR REASONS 1.4 (B),(C),AND (D). ¶1. (U) This is an action request. Embassy Seoul please see para 3. ¶2. (S) Background and objective: The United States has information that in June 2009, the Malaysia-based procurement entity Skylife Worldwide Sdn Bhd expressed interest in purchasing U.S.-origin measuring equipment from the South Korean firm Far Eastern Trading Company Limited. The equipment (instruments for center of gravity and moment of inertia measurement) is not controlled by the Missile Technology Control Regime (MTCR),but can be used in the production and testing of ballistic missile components, including warheads. Although Skylife is located in Malaysia, it is actually a front company for the Iranian procurement agent Mohammad Mahdavi, who has previously procured sensitive goods on behalf of Iranian entities of proliferation concern. We want to share this information with ROK officials and urge them to take measures to prevent Far Eastern Trading Company from supplying this equipment to Skylife or other entities affiliated with Mohammad Mahdavi. ¶3. (U) Action Request: Request Embassy Seoul approach appropriate ROK government officials to deliver talking points in paragraph 4 below and report response. Talking points also may be provided as a non-paper. ¶4. (SECRET//REL SOUTH KOREA) BEGIN TALKING POINTS/NON PAPER: -- We would like to raise with you a matter of proliferation concern and request your government's assistance in investigating this activity. -- The United States has information indicating that in June 2009, the Malaysian-based firm Skylife Worldwide Sdn Bhd expressed interest in purchasing U.S.-origin measuring equipment from South Korea's Far Eastern Trading Company Limited. -- Specifically, Skylife requested price quotations for a model POI-300 instrument for center of gravity and moment of inertia measurement for light components, as well as a model POI-3500 instrument for center of gravity and moment of inertia measurement for heavy components. -- Both of these pieces of equipment are manufactured by the U.S. firm Space Electronics, Inc. -- Although not controlled by the Missile Technology Control Regime (MTCR),this equipment can be used in the production and testing of warheads and other ballistic missile components. -- Moreover, although Skylife Worldwide is located in Malaysia, it is actually a front company for the Iranian-based procurement agent Mohammed Mahdavi. -- Mahdavi has procured sensitive goods on behalf of a number of Iranian entities of proliferation concern, including: the Shahid Hemmat Industrial Group (SHIG), Iran's primary developer of liquid-fueled ballistic missiles; and Heavy Metal Industries, a front company for Ya Mahdi Industries, an Iranian developer of tactical missile systems. -- Mahdavi also uses the Malaysian-based front company Electronics Component Limited (ECL) in his procurement efforts. -- Both SHIG and Ya Mahdi are designated by United Nations Security Council Resolutions for their involvement in Iran's missile programs. -- We therefore urge you to take all appropriate measures to prevent Far Eastern Trading Company from supplying this equipment to Skylife, ECL, or other firms affiliated with Mohammed Mahdavi. -- We appreciate your cooperation on nonproliferation matters and look forward to hearing the results of your investigation. ¶5. (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 and EAP/K. CLINTON