IRAN'S FEDCO CONTINUES EFFORTS TO PROCURE FRENCH

S E C R E T STATE 087162 SIPDIS E.O. 12958: DECL: 08/21/2034 TAGS: MTCRE PARM PREL ETTC KSCA GM AE IR SUBJECT: IRAN'S FEDCO CONTINUES EFFORTS TO PROCURE FRENCH CONNECTORS FROM GERMAN FIRM (S) REF: A. STATE 2425 ¶B. BERLIN 45 Classified By: ISN/MTR ACTING DIRECTOR RALPH PALMIERO, REASON: 1.4 (C). ¶1. (U) This is an action request. Embassy Berlin, please see paragraph 3. ¶2. (S) Background: In January 2009, the United States shared information with Germany that the UAE-based firm Alkaen Equipment and Industrial Supplies LLC placed an order with Germany's MPS Electronic Vertriebs GmbH for military-grade connectors produced by the French firm Souriau (Refs). This order was placed on behalf of Farazeh Equipment Distributor Company (FEDCO),an entity that has acted as a supplier to a number of Iranian entities of proliferation concern, including the Shahid Hemmat Industrial Group (SHIG) - Iran's liquid propellant ballistic missile developer - and entities affiliated with Iran's UAV program. We now understand that FEDCO is continuing its efforts to obtain Souriau connectors from MPS Electronic, and that as of mid July 2009, an MPS Electronic representative provided a price quotation for these connectors and other equipment to Elite Advanced Solutions - a Malaysia-based front company for FEDCO. As in the case involving Alkaen, we believe that the true end-user is located in Iran, and that FEDCO is using the Malaysia address of Elite Advanced Solutions in order to circumvent German export restrictions. We want to urge German officials to take all appropriate measures to ensure that MPS Electronic Vertriebs GmbH is not acting - even inadvertently - as a supplier to Iranian entities of proliferation concern. ¶3. (S) Action Request: Request Embassy Berlin approach appropriate host government officials to deliver talking points/non-paper in paragraph 4 below and report response. Talking points also may be provided as a non-paper. ¶4. (S) Begin talking points/non-paper: (SECRET//REL GERMANY) --We would like to alert you to information of proliferation concern and request your assistance in investigating this activity. --In January 2009, we shared with your government information that in November 2008, the UAE-based firm Alkaen Equipment and Industrial Supplies LLC placed an order with the German firm MPS Electronic Vertriebs GmbH for military-grade connectors produced by the French firm Souriau. --Alkaen is a front company for the Iranian procurement firm Farazeh Equipment Distributor Company (FEDCO),an entity that has acted as a supplier to a number of Iranian entities of proliferation concern, including Shahid Hemmat Industrial Group - Iran's liquid-propellant ballistic missile developer - and entities affiliated with Iran's UAV program. --FEDCO is also the parent company of a number of other procurement entities, including Malaysia-based front companies Evertop Services and Elite Advanced Solutions --As we indicated in our earlier discussions of this issue, once Alkaen received these connectors from MPS Electronic, it planned to forward them to FEDCO. --We do not know if MPS Electronic ever shipped the order to Alkaen, but now have additional information related to this case that we would like to share with you. --We understand that FEDCO is continuing its efforts to acquire Souriau connectors from MPS Electronic. --Specifically, we have information indicating that as of mid July 2009, MPS Electronic representative Matthias Oettl provided Elite Advanced Solutions a price quotation for a quantity of Souriau 851-series connectors and other equipment. --As in the case involving Alkaen, we believe that the true end-user is located in Iran, and that FEDCO is using the Malaysia address of Elite Advanced Solutions in order to circumvent German export restrictions. --We urge you to investigate this information and to take all appropriate measures to ensure that MPS Electronic Vertriebs GmbH is not acting - even inadvertently - as a supplier to Iranian entities of proliferation concern. --We look forward to continuing our excellent cooperation on nonproliferation matters and to hearing the results of your investigation of this case. End talking points/non-paper ¶5. (U) Washington POC is ISN/MTR John Paul Herrmann (Phone: 202-647-1430). Please slug any reporting on this issue for ISN/MTR and EUR/CE. ¶6. (U) A word version of this document will be posted at www.state.sgov.gov/demarche. CLINTON