Local

Iranian-born KC aviation figure with colorful past appears in Panama Papers

Farhad Azima of the Aviation Leasing Group made his fortune in airline ventures after he immigrated from Iran. He calls claims that he’s some shadowy figure nonsense.
Farhad Azima of the Aviation Leasing Group made his fortune in airline ventures after he immigrated from Iran. He calls claims that he’s some shadowy figure nonsense. jtoyoshiba@kcstar.com

Along Ward Parkway, in a house where a single piece of art might cost more than your last three cars, lives perhaps the richest local guy Kansas City doesn’t much know.

He’s handed out millions in political donations over the years and has been especially fond of Hillary and Bill Clinton. He’s a character — an innocent one, he insists — in the Iran-Contra scandal of the 1980s. A company he ran also once got tangled in an alliance between Palestinian terrorists and Central American rebels.

Farhad Azima’s name shows up in news accounts every decade or so, always dripping with international intrigue, sometimes involving overseas military shipments, circling around the various sprawling aviation companies he’s spawned.

Most recently, he and his Kansas City-based Aviation Leasing Group appear in the Panama Papers in thousands of pages leaked from the law firm Mossack Fonseca this spring, showing a number of American companies setting up offshore companies.

Like so many of the tales involving Azima, the Panama Papers chapter gives rise to cloak-and-dagger speculation — versions the Iranian immigrant finds twisted from reality.

In a rare interview, the 74-year-old with a pacemaker and a thick accent said, yes, he’s flown military supplies around the world. But only, he insists, at the behest of Uncle Sam.

People want to see him as some shadowy figure, maybe a stooge for the CIA, dealing in subterfuge, he said. Azima calls that nonsense.

“I’ve never been employed by the CIA,” he said.

But perhaps contracted by the intelligence agency?

“Sure, but not directly. … Maybe XYZ company or whatever,” Azima said. “I’ve done classified work. … It’s not working for (former Soviet spy outfit) the KGB or the enemy. I’m proud of it.”

Azima said he spoke to The Star about his Panama Papers cameo and his colorful life to protect his reputation.

The image drawn by periodic news coverage suggests a possibly shady character who’s made millions from associations with even dodgier characters in the Middle East, Africa and Eastern Europe. Azima says that’s wrong.

He arrived almost a half century ago as a junior college student in Chanute, Kan. Since then, Azima said, he’s been running honest businesses that often helped carry out American foreign policy, which he considered his patriotic duty. Simply crossing bad characters along the way, he said, does not make him one.

“There’s a lot of bullshit in the press,” he said. “If you Google, you see a lot of whatever you want.”

Milk, oil and planes

Azima arrived in the United States in 1962 at the age of 21.

He had come from a prominent Azerbaijani family — he calls them “landed gentry” — in northwestern Iran. The family lost much of its wealth and status in the country’s land reform movement, and his father became a judge.

Azima graduated from William Jewell College in 1967, became an American citizen in 1979 and has kept a home here ever since.

He ran a small import-export business for a time in Kansas City after college, but the turning point in his career came when he established Global International Airways in 1977.

Three things combined to launch him to big money. The pro-U.S. Shah of Iran wanted to move the country off powdered milk, promising a glass of fresh milk for every child. In the 1970s, the Organization of the Petroleum Exporting Countries brought newfound money to the region and gave the shah resources to launch an Iranian dairy industry. Meanwhile, the U.S. airline industry was going through deregulation.

So Azima, playing on family connections in Iran and a handful of financial backers in Kansas City, pieced together a business chartering planes to ship small dairy cattle to his Persian homeland. He knitted together contacts in the Midwest to buy pregnant Holstein cows and a network of buyers in Iran.

“They told me any idiot can have an airline,” he said. “I became one of those idiots.”

Global flew four Boeing 707 airliners and became adept at everything from delivering the cattle to various farms in Iran to cleaning out the filth left behind by cattle in the cargo holds.

He gradually diversified his air freight business throughout the Middle East, Central America, Europe and Africa and soon found his operation in international headlines.

Guns on board

The new ventures meant new adventures. In 1979, one of Global’s planes had been chartered to take Red Crescent relief supplies from Lebanon to Nicaraguan refugees in Costa Rica. Azima recalls the cargo was to be “blankets, stuff like that.”

But as the jet flew over Tunisia, a group there managed to force the plane into an unscheduled landing on a commercial airstrip. At the time, the territory served as a staging ground for the Palestinian Liberation Organization.

Weapons were loaded onto the plane. The crew at first refused to take off. Then they took off and returned to the same airfield. The pilots said the load was too heavy for a transatlantic trip, and the arms were taken off.

The Tunisian government and much of the international community cited the incident as proof that the PLO was running weapons to leftist Sandinista rebels in Nicaragua.

Azima said that neither he nor Global did anything wrong to get caught up in the incident.

“When it happened, I turned it over to the U.S. and the (Federal Aviation Administration) to handle it,” he said.

Later that same year, as students on the streets of Tehran protested and American hostages were held under the control of Ayatollah Ruhollah Khomeini, The Kansas City Times grouped Azima with “establishment Persian-Americans … fuming with indignation over recent events in their native land.”

“Unfortunately,” Azima told the newspaper then, “it is the tyranny of the minority ruling over the silent majority. … These are 10 to 15 percent of the people who have nothing, and have nothing to lose.”

Azima said his company was suffering because, at the time, 35 percent of Global’s business depended on shipping spare military parts to Iran. The then-recently ousted shah had been an American ally. Today, Azima says he only carried cattle to Iran, never military supplies.

Within three weeks of the seizure of the U.S. embassy in Tehran, Azima said at the time, he’d lost several contracts, including one worth $1 million a month. “This situation could put us under,” he said. He called Khomeini a “madman.”

After the Camp David Accords of 1978 brokered a landmark peace deal between Israel and Egypt, Global began flights bringing U.S. military aid to Egypt — the first time, Azima said, he dealt in arms shipments.

In 1980, he began to expand to chartered passenger services.

When President Anwar el-Sadat of Egypt was assassinated in the fall of 1981, his son Gamal el-Sadat was flown home from the United States on a jet chartered from Global.

Global quickly grew to become one of the country’s largest chartered air carriers and almost as quickly fell into financial problems. Global filed Chapter 11 bankruptcy in May 1982. It had plunked down millions for five Boeing 707s from PanAm. It then became embroiled in lawsuits with PanAm over the airworthiness of the planes while Azima struggled with airline labor unions.

That legal wrangling forced Global to fall behind on payments to European airports and saw aircraft seized for nonpayment. It eventually liquidated. Azima acquired some of the pieces of that failed company to put together the Aviation Leasing Group operation that remains in business today.

In 1984, pilots speaking mostly anonymously to The Kansas City Times said that Global had been running weaponry for years and that crews often joked their cargo included “cabbage and cabbage launchers” airlifted to remote spots in war-torn countries.

Among those deliveries, one of the pilots claimed, were munitions bound for Islamabad, Pakistan. At the time, Pakistan was a staging ground to supply Islamist forces resisting the Soviet occupation of Afghanistan.

Azima confirmed in a 1984 interview with The Star that Global ferried arms to Pakistan and elsewhere with an OK from the U.S. State Department. He also repeatedly replied “no comment” in that interview when asked about CIA involvement in the flights.

Azima told The Star in 1984 that “an airline deals with documents. We don’t go and open the crates and see what’s in them.”

He says virtually the same thing today: “To the best of my knowledge, we only flew with clean cargo.”

Eventually he would liquidate one airline, Capital Airways, and let Global dissolve. But Azima had started Aviation Leasing Group in 1983 as an in-house leasing company. It was from the foundation of ALG that his business would thrive through the years.

With the power to fly cargo virtually anywhere, he would sometimes again find himself amid international intrigue.

Then-retired Air Force Gen. Richard Secord approached him in 1985, Azima said, asking for help in what would grow to become the Iran-Contra scandal.

Secord wanted one of ALG’s jets to fly arms being sold covertly and illegally to Tehran, Azima said. The arms sale was critical to a deal to free hostages held by Iranian revolutionaries, with the profits to be used later to secretly fund anti-communist Contra rebels in Nicaragua. It was the defining scandal of the Reagan administration.

“I rejected it,” Azima said. “I told him ‘(the Iranian regime) will use you like a Kleenex and then throw you away.’ 

Yet in the end, an ALG Boeing 707 owned by Azima was widely identified as the plane that delivered the weapons. Still, Azima has insisted for decades it was not his doing. Rather, he said the plane had been leased to Race Aviation, a company owned by his brother, Farzin Azima.

“I’m disappointed more than I can ever tell you if (Farzin Azima) did that,” Farhad Azima said in the interview.

Azima said he’s been “investigated nine ways from Sunday” over any involvement in the Iranian weapons delivery without evidence he knew what happened. He swears he’s never asked his brother about it.

“I don’t want to hear the answer,” Azima said.

Farzin Azima said he had no role in arms shipments to Iran. He said he shared aircraft log books showing his company was only involved in flights to Spain at the time with congressional investigators.

“I don’t think me or my company had any involvement in these things,” the Overland Park resident said in a phone interview. “My company had nothing to do with that affair, nor did I personally. I’m not close to my brother’s business. … We had nothing to do with it.”

In the years since, Farhad Azima’s company has ferried supplies to Pakistan, Afghanistan, Kuwait and Iraq supporting military campaigns from 2003 through 2012.

Panama problems

He’s attracted attention again after his move to establish a company in the British Virgin Islands was documented last month by the International Consortium of Investigative Journalists.

The ICIJ story described the Mossack Fonseca law firm as specializing “in building labyrinthine corporate structures that sometimes blur the line between legitimate business and the cloak-and-dagger world of international espionage.”

The lawyers’ documents show Azima and Aviation Leasing Group creating Eurasia Hotel Holdings Ltd. with plans to buy a hotel in the country of Georgia in 2011. One of the few people named as a shareholder in that company was Houshang Hosseinpour. Records show him with a Dubai address.

At the time, Hosseinpour had been cited by U.S. Treasury officials for moving millions of dollars for companies in Iran when the country was under American and international financial sanctions. He was later penalized for his role in those dealings.

In a 2014 news release, the Treasury Department said that in 2011, Hosseinpour helped acquire “the majority shares in a licensed Georgian bank … (and) then used the Georgian bank to facilitate transactions worth the equivalent of tens of millions of U.S. dollars for multiple designated Iranian banks.”

Officials from Aviation Leasing Group said in the leaked documents that they’d not meant to issue stock to Hosseinpour.

In an email to a business development manager at Mossack Fonseca in February 2012, a representative of a Gibraltar-based firm wrote that an official from Aviation Leasing said, “ ‘Mr. Hosseinpour has nothing to do with this company’, including him must have been an administrative error.” That same month, Eurasia Hotel Holdings Ltd. was renamed Eurasia Aviation Holdings Limited.

Azima told ICIJ the Caribbean company was needed for ownership of a new plane that would not be used in the United States and couldn’t gain U.S. registration. He said the foreign company provided a place to register the plane, not a tax dodge.

“I’ve filed every tax known to mankind,” Azima told ICIJ.

Azima said the ICIJ story didn’t recognize his own rejection of Hosseinpour.

His company planned to buy a 5 percent share of a Sheraton hotel in Georgia with Hosseinpour and two other people, he said. That’s what prompted him to establish Eurasia Hotels.

Azima said the British Virgin Islands would provide a fair legal playing ground if he were caught up in legal or financial disagreements with his prospective partners. He didn’t trust the courts of a country that only a few decades before was a Soviet republic and believed he’d have trouble getting loans for a company based in Georgia.

“You go to an area” — the Caribbean — “where they are civilized,” he said.

Soon, Azima said, he contacted the Treasury Department and learned more about Hosseinpour and the others in on the Georgian deal and decided “I don’t want to be part of it. I don’t feel comfortable with them.”

The hotel deal fell apart. Eurasia Hotels was established in October 2011. Meanwhile, Azima was working to help launch a small airline in Georgia. So four months after Eurasia Hotels was born, the company’s name was changed to Eurasia Aviation. That’s the same month that the Panama Papers show Hosseinpour was removed as a shareholder.

“It was a big mistake,” Azima said. “We should have just created a new company rather than trying to save money by changing the name.”

The British Virgin Islands served a similar purpose for the airline. It gave Azima and ALG a country where they trusted the rule of law but didn’t have to license, staff and register its planes to strict U.S. standards.

Political money

Azima has also long been a big-league contributor to political campaigns. While most of his contributions in federal elections have been to Democrats, he also gave money to Republican Mitt Romney’s run for the White House and to other GOP candidates.

His ties to the Clinton family go back several years. He gave money to Bill Clinton’s legal defense fund in the wake of the then-president’s impeachment. In a 1999 Washington Post article, he said he’d pledged $1 million to Bill Clinton’s presidential library “and certainly I will do far more than that.”

As president, Clinton had appointed Azima to the U.S. Economic Development Administration.

He donated to Hillary Clinton’s 2000 U.S. Senate campaign and her 2008 presidential run.

He’s listed on the Clinton Foundation’s website as someone who donated at least $250,000.

In 1997, the Democratic National Committee said it was returning $143,000 to Azima after media reports linked him to the Iran-Contra shipment. The DNC later apologized and decided to keep the donation.

Azima still has the letter of apology that cited “outdated, erroneous news accounts” for its initial rejection. He’d contemplated suing for damage to his character. The apology fixed things, and Azima has continued to give regularly to Republicans and (more often) Democrats.

Azima said he’s waiting until after the July conventions before deciding to give more to Hillary Clinton. But he gestures at his home and says, “I’ve had her here many times” for fundraisers in the past.

It’s a mansion even by Ward Parkway standards. A sunroom holds original Remington sculptures the way your utensil drawer stores spatulas. The formal garden in the backyard holds the 24-foot nose cone used for testing supersonic Concorde jet prototypes in the 1960s.

He’s still married to the Kansas high school student he met when he was a junior college student almost 50 years ago. They have another home in Miami and one in London and like to spend their summers on the coast of southern France.

The 1-percenter luxury, he says, doesn’t tempt him to retirement.

“I’ll die,” he said, “with my boots on.”

Related stories from Kansas City Star

  Comments