Bomb Components to Iran: US and Germany Tussle over Arresting Suspected Smuggler

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At that point, the network reportedly started trying to figure out new ways to get around the embargo on Iran. And this is where American investigators believe N. comes in. According to their findings, in 2008, N. ordered pressure valves, water valves and temperature and humidity gauges from companies in Chicago before turning them over to a Malaysian company called Vat Solutions. This company, which is owned by an Iranian-born man living in Malaysia, then purportedly shipped the equipment to Iran.

N.'s ties to this Malaysian company are what put US investigators on his tail. Indeed, American authorities were already monitoring Vat Solutions' activities because it had supplied components to Iran for remote-control systems, sensors and electronic circuits.

N. continues to plead his innocence and claims that this has all been a big mistake. But the US is still investigating him. Last year, American officials unsuccessfully petitioned their German counterparts to detain N. Their hopes were stymied when an upper district court for the northern state of Schleswig-Holstein, which is home to Kiel, blocked the request, saying it couldn't find any factual basis that justified launching a criminal inquiry into N.'s deliveries. The court based its decision on the fact that both German and European law permits the exportation of the components he traded. "The subject is accused of doing something that does not constitute a criminal offense in Germany," the court found.

Still, the court's views aren't wholeheartedly shared by German customs officials, who believe the parts N. ordered from the US could certainly be classified as "dual-use," thereby rendering their exportation illegal. "One should have applied for an export permit in this country depending on the specification of the components," one customs investigator said.

Suspected Money Laundering

What's more, N. is no stranger to German authorities. Indeed, in 2008, the public prosecutor's office in Kiel investigated him on suspicion of being part of a money-laundering scheme related to Iran.

On July 18 of that year, Citibank filed a legal complaint about suspected money laundering related to a transfer of €80,000 ($107,000), which was reportedly initiated in Iran before making its way to N. via an Iranian businessman in Hamburg.

At that point, German federal prosecutors started looking into the matter because they suspected that the money could be used for funding terrorism. N. eventually gave the authorities a plausible explanation for the payment, saying it came from the sale of a house in Iran and had nothing to do with his business dealings in the United States. Lacking a basis for continuing their investigation, German authorities shelved it.

Disappeared

Since then, N. seems to have disappeared. He doesn't respond to e-mails. Inquiries made during a recent visit to his home in Kiel were answered with the claim that he is traveling abroad. His lawyer in Kiel refuses to speak to SPIEGEL. And he appears to have removed his company from the business register of Kiel's chamber of commerce in 2006.

The only sign of life is his website, which looks more like something you would expect from a major corporation than from a small local businessman. It advertises oil- and gas-related devices, high voltage transformers and automation equipment. "We have strong partners in many firms, in state organizations in the Middle East, Malaysia and Azerbaijan," the website proclaims. But it makes no mention of the fact that the company's strongest rival is the American justice system.

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• Part 1: US and Germany Tussle over Arresting Suspected Smuggler
• Part 2: Did N. Commit a Criminal Offense?