Corruption in the Zahedi Government
Shah Reprimands Cabinet, Mulls Removing Premier

Arash Norouzi
The Mossadegh Project | December 30, 2021                    

General Fazlollah Zahedi (1892-1963) | Prime Minister of Iran, 1953-1955

In June 1954 the CIA issued a series of reports indicating that Fazlollah Zahedi, whom they helped install as Prime Minister in place of Mossadegh, was in hot water politically, and the Shah was anxious to remove him.

“The current rumors in Tehran accusing Zahedi’s regime of corruption have apparently been accepted by the shah as a basis for considering Zahedi’s replacement”, they wrote on June 11th. “Nevertheless, the shah has assured the American and British ambassadors he will support Zahedi, at least until the oil negotiations are completed.”

The following CIA report is a little more in depth, though several lines remain censored. Zahedi, ultimately, lasted as Premier until April 1955, and quickly faded from public view.

CIA Documents on Iran, Mossadegh, 1953 Coup

367. Information Report Prepared in the Central Intelligence Agency

Washington, June 14, 1954



           Corruption in the Zahedi Government


           Paragraphs 1–3: [2 lines not declassified]
           Paragraph 4: [1 line not declassified]
           Appraisal of Content: [less than 1 line not declassified]

1. The Shah believes that the popularity and power of the Zahedi Government is at a low ebb as the result of widespread corruption. [Fazlollah Zahedi] This situation is further aggravated by activities of the Tudeh Party, which has exaggerated the extent of the corruption, thus contributing greatly to the growing storm of popular dissatisfaction with the present Government. The Shah stated that this situation must be stopped and expressed the opinion that the Government can be held in office only so long as he lends it his strongest support.

Field Comment: It is likely that, unless Zahedi launches his own effective anti-corruption campaign, the chances of survival of his Government following conclusion of the oil negotiations are practically nil.

2. Despite the conviction that the swelling flood of rumors concerning corruption in the Zahedi Government is strengthening the communist hand in Iran and weakening the Shah’s own position, the Shah decided to continue giving “strong” support to the present Government. His decision was based on the fear that any show of friction between the Shah and the Government might have an adverse effect on the oil negotiations.

Field Comment: The Shah’s decision to continue to support the Zahedi Government was confirmed by an Iranian source in close personal contact with the Royal Court for the past 21 years. [Hossein Ala?] However, unconfirmed reports indicate that the Shah is intriguing within and actively penetrating the civil bureaucracy which traditionally has been the Prime Minister’s province.

3. After reaching this decision, the Shah called in the entire Cabinet on 2 June and administered a firm rebuke, calling for immediate reforms and stern action to control corruption at all levels.

4. The Shah received Ardeshir Zahedi in audience on 3 June, following the latter’s return from Europe on 2 June. When Ardeshir emerged from the audience, he was in tears and remarked bitterly, “Why wasn’t I told how bad things are? I could have been here to help. My father is a good man: His Majesty knows that he is a good man.” [Formerly employed with Point Four, Zahedi was a participant in the 1953 coup]

Source Comment: It is obvious that the Shah delivered a strong lecture concerning corruption. This is the most dangerous issue in Iran at the moment and one in which the Shah is extremely interested.

[Annotations by Arash Norouzi]

• Source: Foreign Relations of the United States, 1952–1954, Iran, 1951–1954 (2017)

“Central Intelligence Agency, DDI Files, Job 80–00810A, Box 43, Folder 53, CS Information Reports 40130–40139. Secret” — U.S. State Department Office of the Historian

Zahedi & Churchill’s Secret Messages After 1953 Coup
After OPERATION AJAX, CIA Commendations Planned for 1953 Coup in Iran


Related links:

Kermit Roosevelt on CIA Suppression of Iranian Communists (Oct. 9, 1951)

CIA Propaganda and Psy-Ops in Iran To Help Premier Zahedi Survive (July 1954)

Tudeh Newspaper “Shojat” Predicts Iran Coup Plot (Aug. 1953)

MOSSADEGH t-shirts — “If I sit silently, I have sinned”

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