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(Bloomberg) — Francesco Mazzagatti, an energy trader who has become a key figure in the North Sea industry, is facing a worldwide asset freeze over allegations he siphoned off funds from former business partners in Iran.
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The Italian entrepreneur is accused in a London lawsuit of profiting through indirect ownership of an Iranian plastics resin producer, Mehr Petrochemical Co.
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Alliance Petrochemical Investment, a Singapore-based company with a stake in Mehr and co-owned by the Jahanpour family, alleges in court filings that Mazzagatti and an associate diverted customer payments and profits, and withdrew funds directly from company accounts.
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API alleges almost €144 million ($166 million) were stolen by Mazzagatti and an associate, and the company is now seeking an asset-freezing order of €160 million.
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API’s application “is fundamentally flawed. It is based on fraud allegations which API has already been pursuing for over three years,” Mazzagatti’s lawyer said in court filings. “Granting the injunction would have a catastrophic impact on Mr Mazzagatti.”
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The request for a worldwide freezing order marks the latest setback for Mazzagatti, the UK’s top-paid oil executive. In January, Shell Plc and Exxon Mobil Corp. scrapped a proposed deal to sell natural gas assets to his company, Viaro Energy, after an 18-month review of the transaction by UK authorities. In December, an Abu Dhabi state oil firm won a London court appeal related to a soured joint venture.
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Mazzagatti’s lawyers filed a claim in Dubai against API and members of the Jahanpour family, alleging they have “engaged in an elaborate conspiracy against him, including by pursuing the English proceedings,” according to the filings prepared for the London hearing that started Tuesday.
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Mazzagatti’s relationship with the Jahanpour family started in 2014. As a self-made oil trader recently moved to Dubai from Italy, Mazzagatti became friends with Arshiya Jahanpour through his then brother-in-law. In court documents, Mazzagatti characterized his acquisition of a stake in API largely as a favor to Jahanpour.
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The US Treasury said in 2023 that Mehr was at the heart of a vast “shadow banking network” that helped other companies continue to do business on behalf of the Iranian regime. Shortly after the sanctions kicked in, Mazzagatti transfered his stake in API to a friend of his in Dubai.
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API alleges that a substantial portion of the funds siphoned off from Mehr was used to finance the acquisition of RockRose Energy in the UK, a deal that kickstarted the growth of Mazzagatti’s Viaro in the North Sea.
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