TEHRAN The former head of a bank at the center of Iran's biggest ever financial scandal said on Wednesday he had been made a scapegoat by President Mahmoud Ahmadinejad's government which is under mounting pressure over the record $2.6 billion scam.
Mohammad Jahromi, forced from his post as head of part-privatized Bank Saderat on Tuesday by a government committee, said he had helped uncover the crime rather than being responsible for it, and accused another disgraced bank chief of fleeing the country.
The scandal could be damaging for Ahmadinejad, whose critics have accused his top aide of having links to investment company Amir Mansour Aria which is accused of fraudulently obtaining vast bank loans -- the latest and potentially most serious charge against the president's circle from rival factions within the conservative ruling elite.
Ahmadinejad has denied any government wrongdoing and has urged the judiciary to pursue the case vigorously. At least 19 arrests have been made so far and the prosecutor in charge has said culprits could face the death penalty.
Members of parliament have called for Economy Minister Shamseddin Hosseini to be impeached and other senior government figures are under mounting pressure.
"The dismissal of the head of the central bank and the economy minister would reduce people's concerns. If not, the revolutionary parliament will do its duty," lawmaker Jabbar Kuchakinejad said, according to parliamentary website.
The scandal has erupted as political factions start to jostle for position ahead of parliamentary elections in March which will set the scene for a presidential race in 2013, which will decide who succeeds Ahmadinejad.
OUT OF THE COUNTRY
The most senior official to lose his post so far is Mahmoud Reza Khavari, the head of Iran's biggest bank, state-owned Bank Melli, who resigned on Tuesday.
Jahromi said Khavari had fled Iran for Canada to avoid arrest, something a Bank Melli spokesman denied, saying he was merely out of the country for one day and would return on Thursday, the ISNA news agency reported.
"Despite my follow-ups and contacting the intelligence ministry and judiciary for the arrest of the main culprits, the main backers of this corruption have publicly blamed Bank Saderat and its manager," Jahromi said in comments carried by the semi-official Fars news agency.
In a leader column in Iran daily, Ahmadinejad's senior media adviser Ali Akbar Javanfekr said other arms of government -- supposedly parliament and the judiciary -- should be blamed for the scandal.
"Other bodies have the duty to supervise affairs in a way that prevents corruption ... If they had done this duty correctly, would corruption like embezzlement and disorder in the country's economic system happen?" he wrote.
That is unlikely to please Ahmadinejad's critics in parliament, who have threatened to impeach the president over other matters but so far have held back from taking a step that could be damaging to the wider political system.
Under instruction from Supreme Leader Ayatollah Ali Khamenei, the legislature approved legislation on Wednesday that will create a new body to supervise parliamentarians, something some lawmakers fear could limit their independence.
The law gives the new body the right to dismiss lawmakers found to be abusing their positions, particularly in financial affairs and matters of national security, Fars reported.
(Writing by Robin Pomeroy; Editing by David Holmes)