FDD Study: Iran’s Islamic Revolutionary Guard Corps Benefits Most from Iran Deal

(Washington, D.C., Oct. 4 2016) — The influence and reach of the Islamic Revolutionary Guard Corps (IRGC) in Iran’s economy and military is so extensive that it stands to be the largest beneficiary of the Joint Comprehensive Plan of Action, negating the notion that the Iran nuclear deal might temper Tehran’s hardline leaders, according to a report issued today by the Foundation for Defense of Democracies (FDD).

Established as the Praetorian Guard shortly after the 1979 Iranian revolution, the IRGC has evolved into a full-fledged conventional army that directs Iranian terrorist activity abroad. But it has also become an economic conglomerate, controlling nearly 40 percent of Iran’s economy.

FDD’s new report, “How the Nuclear Deal Enriches Iran’s Revolutionary Guard Corps,” includes a sector-by-sector analysis of the IRGC’s influence on Iran’s economy. Authors Emanuele Ottolenghi, Saeed Ghasseminejad, Annie Fixler and Amir Toumaj find that the IRGC has an overwhelming stake in nine key sectors: oil and gas, petrochemicals, metals and minerals, automotive, shipping, aviation, construction, banking and finance, and telecommunications sectors. The IRGC uses the profits from these “legitimate” businesses to fund Iran’s military and terrorist proxies.

“The IRGC exploits its influence and capabilities in one part of Iran’s economy to increase its presence in another,” said Ottolenghi, a senior fellow at FDD. “The Guard’s growing economic clout is an end in itself and a tool to support its nefarious activities throughout the region.”

The report details how the IRGC’s enormous wealth should be of concern to policymakers for three reasons:

• It generates revenue to finance military activities, including the nuclear and ballistic missile programs at home and sponsorship of terrorism abroad;
• It provides the IRGC with a network of companies, banks and joint ventures to assist the Islamic regime in purchasing advanced weaponry and sensitive technology;
• It generates personal affluence for IRGC cadres, which the IRGC translates into political influence to pressure legitimate companies to support the Guard’s efforts to procure forbidden technologies and raw materials, and to finance their purchases through middlemen in foreign markets.

The authors detail more than a dozen concrete steps that can be part of an overall economic strategy that the new administration and Congress can use to halt Iran’s regional aggression and terror activities.

“The end of sanctions does not mean the end of legal, regulatory, or business risk,” Ottolenghi said. “In fact, as sanctions are reduced, the risk for businesses increases.” 

To arrange an interview, contact [email protected] or 202.403.2904.

About FDD:

The Foundation for Defense of Democracies is a non-profit, non-partisan 501(c)3 policy institute focusing on foreign policy and national security. Founded in 2001, FDD combines policy research, democracy and counterterrorism education, strategic communications and investigative journalism in support of its mission to promote pluralism, defend democratic values and fight the ideologies that drive terrorism. Visit our website at www.defenddemocracy.org and connect with us on Twitter, Facebook, and YouTube.