Several Iranian banks have been targeted in one of the biggest frauds in the Islamic republic's history losing nearly USD 2.6 billion in more than 2 years.

The fraud was reportedly orchestrated by a single man referred to as Mr X in Iranian media who developed a network and used forged letters of credit to purchase assets including one of Iran's largest steel production companies, Khuzestan Steel Company.

Mr Mahmoud Bahmani chief central bank said that “Mr X ran his master plan from June 2009 to last August, pocketing around IRR 28 trillion and also unsuccessfully attempting to form a new bank."

Mr Mohammad Jahromi CEO of Bank of Saderat whose organization was one of the victims of the fraud said that 7 other banks were also hit.

Mr Mostafa Pour Mohammadi head of general inspection organization labelled the fraud the most unprecedented financial corruption case in the Islamic republic's history.

Influential conservative lawmaker Ahmad Tavakoli said the case represented a terrible corruption disease lurking in Iran's banking system and administrative apparatus."

Judiciary chief Ayatollah Sadeq Larijani said the people involved in this case have been arrested before the media got wind of the story. He did not elaborate.

The Germany based corruption watchdog Transparency International last year ranked Iran 146th out of 178 countries on its annual list.

(Sourced from ninemsn.com.au)