Massive Iranian Bank Scandal Threatens To Take Down Ahmadinejad?

Karma's a bitch. Mahmoud Ahmadinejad, the President of Iran, is threatened by a huge banking scandal in Iran where he's alleged to have been in on a $2.5 billion dollar bank scam.

The largest case of bank fraud in Iranian history is threatening to engulf President Mahmoud Ahmadinejad after a parliamentary commission decided to investigate his office for possible connections to the crime, Iranian state media has reported.

To add insult to injury, Islamist hard-line legislators loyal to Iran's Supreme Leader, the Ayatollah Sayyed Ali Khamenei, subsequently sent the commission a letter requesting specifically that Ahmadinejad be included in the investigation. They have since said they would not follow up on the letter out of respect for Khamenei.

It is one move of many by Islamists to link the president to the alleged embezzlement of 30 trillion Iranian rials -- more than $2.5 billion.

To frame the extent of allegations in U.S. terms: It would be akin to religious conservative legislators attempting to implicate a sitting American president in the infamous Madoff Ponzi scheme, in which disgraced financier Bernie Madoff cheated investors out of $50 billion.

Ahmadinejad has vehemently rejected accusations that anyone in his government is linked to what is currently the highest-profile crime in the country, according to the semi-official Mehr News Agency.

Ahmadinejad and the Islamist hardliners within the mullahs have been at each other since before the disputed elections resulted in massive protests and a violent crackdown against the opposition led by Mirhussin Mousavi. Candidates in Iranian elections are vetted and approved by the religious council - the mullahs - so the crackdown was seen as a schism among the mullahs or a potential power grab by Ahmadinejad. That political and religious tension continues and this latest scandal is an outgrowth of that earlier mess.

Does this have legs? Well, a $2.5 billion bank scandal is nothing to be trifled with - not when most Iranians live in deplorable living conditions and wonder where all the oil wealth has gone.

Ahmadinejad's close economic advisers are tied to the case:

The main suspect in the case has ties to the Iranian president's chief adviser, Esfandiar Rahim Mashaei, who used his influence in a bank business deal for the accused man, Amir Mansoor Khosravi.

Khosravi had opened a private bank known as the Bank Arya. Getting a license is usually difficult, but Mashaei used his political pull to help pave the way, said economist Dr. Behrooz Hady Zonooz from Tehran.

Add close family ties, and tribal-style alliances, and you've got grounds for collusion, back-room deals, and opportunities for fraud on a massive scale.

The scams involve a greater percentage of Iranian GDP than even the Madoff Ponzi scheme ($50 billion) - and has the potential to take down some of Iran's largest and most prestigious banks.