LegalBrief Africa, an e-newsletter provided by Juta in partnership with the International Bar Association, reported on Thursday, April 17, 2025, that the US District Court for the Eastern District of New York has allowed a “high-stakes Anti-Terrorism Act lawsuit” against MTN Group to advance to the discovery stage. It stated: “MTN Group has wasted no time in submitting an appeal, setting the stage for a precedent-setting legal battle that could rattle courtrooms and boardrooms alike for years to come.”

The lawsuit against MTN Group was initiated by 67 American Gold Star family members, service members, and their families. Filed under the U.S. Anti-Terrorism Act (ATA) of 1990, the plaintiffs allege that MTN Group, a South African telecommunications company, indirectly facilitated terrorist activities by doing business with Iranian entities that served as fronts for the Iranian Islamic Revolutionary Guard Corps (IRGC). The IRGC is a designated terrorist organization by the U.S. government.

MTN has denied the allegations, asserting that its operations in Iran complied with applicable laws and sanctions at the time and that it did not knowingly support terrorist activities. The company has faced similar scrutiny in the past, including accusations of unethical practices in other regions, but this lawsuit represents a significant escalation due to the involvement of U.S. plaintiffs and the invocation of the ATA.

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The case raises complex legal questions about corporate liability for terrorism, the extraterritorial reach of U.S. law, and the responsibility of multinational corporations operating in jurisdictions with ties to sanctioned entities. If successful, the lawsuit could set a precedent for holding telecommunications companies accountable for the downstream effects of their services in conflict zones. The plaintiffs’ legal team is likely to face challenges proving direct causation between MTN’s actions and specific terrorist acts, as well as navigating jurisdictional issues given MTN’s South African base and the Iranian context of the allegations.

“Whether intended or not, the controversial appointment of a senior MTN leadership figure is directly harming US commercial, investment, and trade interests, and that will have a negative impact on US foreign policy interests,” said US foreign policy analyst Michael Walsh.

MTN does not operate in the US but interfaces with US companies, and for example, it this week announced a partnership with US group Meta to enhance the quality of voice and video calls on real-time calling applications such as WhatsApp across 12 MTN markets.

Walsh said the implications of the blowback extended beyond Meta.

“There is an entire ecosystem of US and foreign companies that will likely face increased government, media, and/or shareholder scrutiny of their business relations in South Africa as a result of this episode. One of the most important is Microsoft,” said Walsh.

He stated that in the US, a media firestorm about South Africa could end up having one advantageous benefit for the Ramaphosa administration. Any financial and/or reputational harm that the episode causes for US companies could generate industry pressure on the Trump administration to alter course in US-South Africa relations. He cautioned, however, that the positive pressure for the Ramaphosa administration will likely pale in comparison to the negative pressure that would be generated if the US government pursues even harsher punitive measures against South Africa.

Democratic Alliance deputy spokesperson on foreign relations, Ryan Smith, said diplomatic envoys were the prerogative of the president; however, given the fact that the relationship with the US was in a perilous position, “we need to be extremely pragmatic and careful about who we send to represent us in Washington DC.” Smith said that Jonas’ business experience and acumen were desirable traits for a diplomatic envoy whose primary objective must be repairing the trade relationship with the US, where there were grave trade-related consequences for South Africa should the relationship deteriorate further. He said they hoped his comments five years ago would not be an impediment to getting the ear of the US government. Meanwhile, in South Africa, the Supreme Court of Appeal has yet to make a judgement on an appeal by Turkcell İletişim Hizmetleri in August 2024, on whether it may proceed with a $4.2 billion (R72.9 billion) court case against MTN on allegations of bribery and corruption in Iran.

Let’s uncover the various allegations against MTN Group and the potential legal and geopolitical implications of this lawsuit.

Key Allegations against MTN Group

MTN is accused of working with entities like Irancell, the Foundation for the Oppressed (Bonyad Mostazafan), and Iran Electronics Industries (IEI), which are allegedly fronts for the IRGC. These entities are said to have financed terrorist attacks in Iraq and Afghanistan between 2011 and 2016, during which the plaintiffs or their family members were injured or killed.

The plaintiffs claim MTN provided these Iranian entities with funding, embargoed American technology, equipment, and logistical support. Specifically, the technology allegedly enabled terrorists to monitor American military movements, avoid detection, communicate clandestinely, build and detonate more effective bombs, develop lethal rockets.

The lawsuit asserts that MTN either knew or recklessly disregarded that its business partners were supporting a terrorist campaign. It’s further alleged that MTN entered into an official agreement to support the IRGC’s “security” needs—a euphemism for terrorist activities. On April 15, 2025, the U.S. federal court ruled that the plaintiffs stated a valid claim under the ATA, allowing the case to move to the discovery phase. This phase will involve the exchange of evidence, potentially revealing more about MTN’s dealings and any involvement of South African political figures.

What is the MTN Group?

MTN Group Limited, formerly M-Cell, is a South African multinational telecommunications company headquartered in Johannesburg. It is one of the largest mobile network operators globally and the largest in Africa, operating in over 20 countries, and providing mobile telecommunications services, competing with companies like Vodacom, Cell C, and Telkom Mobile in South Africa. MTN has also expanded into digital services, launching platforms like Ayoba and rebranding its fibre business as Bayobab in 2023. Founded as M-Cell, MTN has grown through acquisitions and partnerships. It faced acquisition talks with India’s Bharti Airtel and Reliance Communications in 2008 but remained independent. In 2018, it sold its Cyprus branch to Monaco Telecom for €260 million, and in 2022, IHS Towers acquired MTN South Africa’s towers.

MTN has faced criticism for its activities in Iran’s telecom sector, particularly its partnership with Irancell, which is central to the ATA lawsuit. Additionally, MTN operates in a country (South Africa) that has been greylisted by the Financial Action Task Force (FATF) since February 2023 for deficiencies in anti-money laundering (AML) and counter-terrorism financing (CFT) frameworks.

The Anti-Terrorism Act (ATA) – Background and previous cases

The ATA, enacted in 1990, allows U.S. nationals who are victims of international terrorism to sue for damages in U.S. federal courts. Key legislative expansions have shaped its application:

• Justice Against Sponsors of Terrorism Act (JASTA, 2016): Expanded the ATA to allow secondary liability for entities that “aid or abet” terrorist acts by knowingly providing substantial assistance to wrongdoers, even if they did not directly commit the attacks. Under JASTA, a defendant doesn’t need to know the specifics of the attacks but must be “generally aware” of playing a role in violent or life-endangering activities.
• Anti-Terrorism Clarification Act (ATCA, 2018): Narrowed the “act of war” defense, ensuring that acts by designated terrorist organizations (like the IRGC) cannot be dismissed as military actions, even during armed conflicts.

The court’s ruling that the plaintiffs stated a claim suggests they met the threshold for secondary liability under JASTA: MTN’s alleged joint venture with Irancell and other IRGC fronts plausibly constitutes “knowingly and substantially assisting” terrorism.

1. ATA’s Evolution and Application

The ATA has evolved to broaden liability for terrorism-related activities:

• Secondary Liability Under JASTA: The 2016 JASTA amendment allows plaintiffs to sue entities for “aiding and abetting” terrorism. In Weiss v. National Westminster Bank PLC (2019), the Second Circuit upheld that a bank could be liable under the ATA for processing payments to charities linked to Hamas, even without direct knowledge of specific attacks, as long as it was generally aware of the terrorist links. This precedent supports the MTN case, where the plaintiffs allege MTN was at least recklessly indifferent to the IRGC’s activities through its Iranian partners.
• Narrowed Defenses (ATCA 2018): The ATCA ensured that acts by terrorist organizations like the IRGC cannot be dismissed as “acts of war.” In Kemper v. Deutsche Bank AG (2017), a pre-ATCA case, the court dismissed claims against a bank for transactions during the Iraq War, citing the “act of war” defense. The ATCA would prevent such a dismissal in the MTN case, as the IRGC’s actions are explicitly categorized as terrorism.
• Technology as Material Support: Providing technology to terrorists has been a basis for ATA liability in prior cases. In Linde v. Arab Bank, PLC (2015), the Second Circuit held that a bank’s financial services to Hamas constituted material support under the ATA. Similarly, MTN’s alleged provision of technology to the IRGC—used to monitor U.S. movements and enhance attacks—fits this framework.

2. MTN’s Alleged Conduct in Legal Context

• Joint Venture with Irancell: MTN’s partnership with Irancell, where the IRGC allegedly holds influence, mirrors cases like Weiss, where indirect support through intermediaries was sufficient for liability. The court’s decision to move to discovery suggests that the plaintiffs’ evidence (e.g., MTN’s agreements with Irancell) was compelling enough to warrant further investigation.
• Knowledge Requirement: Under JASTA, MTN doesn’t need to have known about specific attacks; it only needs to have been “generally aware” of its role in supporting terrorism. The plaintiffs’ claim that MTN agreed to meet the IRGC’s “security” needs suggests at least reckless disregard, if not actual knowledge.
• Impact of Technology Transfers: The technology MTN allegedly provided (e.g., for communication and bomb-making) directly enhanced the IRGC’s capabilities, akin to the material support in Linde. This strengthens the plaintiffs’ case, as the ATA doesn’t require the defendant to have pulled the trigger—only to have substantially assisted the act.

3. South Africa’s Greylisting Context

South Africa’s FATF greylisting since 2023 for AML/CFT deficiencies adds a layer of complexity. The MTN lawsuit highlights systemic issues in South African corporate governance. However, MTN’s operations in Iran predate South Africa’s greylisting, suggesting that the company’s compliance failures may have been longstanding.

4. Broader Legal Precedent

The case reinforces the ATA’s extraterritorial reach, showing that multinational corporations can be held liable in U.S. courts for actions abroad. This aligns with prior cases like Weiss and Linde, but the MTN ruling is historic for targeting a telecom company (not a bank) and for its focus on technology transfers. It may encourage more ATA lawsuits against corporations operating in high-risk regions, particularly those with lax oversight.

U.S.-South Africa Relations

The lawsuit exacerbates tensions, as South Africa’s greylisting already signals international concern about its AML/CFT frameworks. If MTN is found liable, it could reinforce perceptions of South Africa as a hub for illicit financial activities, delaying its removal from the FATF greylist.

The possible involvement of ANC figures could further strain relations if discovery reveals political complicity in MTN’s actions.

• Ralph Mupita, a Zimbabwe-born business executive with a background in civil engineering and finance, has served as the Group President and Chief Executive Officer of MTN Group since September 1, 2020, succeeding Rob Shuter. Prior to his appointment as CEO, Mupita was MTN’s Chief Financial Officer from April 2017 to August 2020, where he played a pivotal role in shaping the company’s financial strategy, managing capital allocation, and resolving complex regulatory challenges. His leadership as CEO has focused on transforming MTN into a diversified technology powerhouse under the “Ambition 2025” strategy, which emphasizes expanding digital and financial services, simplifying operations, and exiting certain markets like the Middle East to focus on Africa. Mupita’s tenure has been marked by efforts to strengthen MTN’s financial position, enhance digital inclusion, and navigate the company through competitive and regulatory landscapes across its 17 African subsidiaries and operations in Iran.
• Mcebisi Jonas, a prominent South African figure and former Deputy Finance Minister (2014–2017), has served as the Independent Non-Executive Chairman of MTN Group’s board since at least 2020. Known for his role as a whistleblower in exposing state capture under former President Jacob Zuma, Jonas brings extensive governmental and economic expertise to MTN. On April 14, 2025, South African President Cyril Ramaphosa appointed Jonas as the country’s Special Envoy to the United States, tasking him with advancing South Africa’s diplomatic, trade, and bilateral priorities amid strained relations with the U.S. under President Donald Trump’s administration. Jonas retains his chairmanship at MTN while serving in this diplomatic role, which involves leading negotiations, fostering strategic partnerships, and engaging with U.S. officials and private-sector leaders.

The timing of Jonas’s appointment—just one day before this significant U.S. District Court ruling has sparked concerns about potential conflicts of interest. The proximity of Jonas’s appointment to the court ruling has raised questions about whether his new diplomatic role could influence or be influenced by the ongoing legal proceedings against MTN, particularly given the company’s operations in Iran, a point of contention in U.S.-South Africa relations. Critics, including U.S. far-right media and some analysts, have expressed concerns about Jonas’s ability to impartially represent South Africa’s interests in the U.S. while chairing MTN, especially in light of his past criticisms of Trump, whom he described in a 2020 speech as a “racist, homophobic rightwinger.” These remarks have fueled speculation that the Trump administration might view Jonas’s appointment skeptically, potentially complicating his diplomatic efforts or even leading to his designation as persona non grata, as occurred with South Africa’s previous ambassador, Ebrahim Rasool, in March 2025.

The potential conflict of interest hinges on several factors:

• Dual Roles: Jonas’s simultaneous roles as MTN’s chairman and South Africa’s special envoy could create perceptions of divided loyalties, particularly as he negotiates trade and diplomatic issues with the U.S., where MTN faces a high-stakes lawsuit. His position at MTN might be seen as influencing his diplomatic approach to U.S. officials involved in or aware of the ATA case.
• Iran Connection: MTN’s operations in Iran, a focal point of the lawsuit, align with broader U.S. concerns about South Africa’s ties to Iran, which have been cited as a point of tension in bilateral relations. Jonas’s association with MTN could amplify U.S. scrutiny, especially as the White House has expressed concerns about Iran’s influence, according to U.S. media reports.
• Political Sensitivities: Jonas’s appointment comes at a time of heightened diplomatic friction, with the U.S. expelling South Africa’s ambassador and Trump threatening tariffs on South African imports (though suspended for 90 days as of April 2025). His past anti-Trump comments and MTN’s legal exposure could undermine his credibility or effectiveness in rebuilding ties.

On the other hand, defenders of Jonas’s appointment, including the African National Congress (ANC), argue that his extensive experience, integrity, and commitment to South Africa’s interests make him well-suited for the role. They emphasize that his MTN chairmanship is a non-executive position, suggesting limited involvement in day-to-day operations, and that his diplomatic mandate focuses on broader trade and investment goals, not specific corporate legal matters. Ramaphosa’s office has underscored Jonas’s distinguished career and the strategic importance of his appointment in rebuilding U.S.-South Africa relations based on mutual respect and sovereignty.

The concerns about conflict of interest remain speculative, as no evidence has surfaced indicating that Jonas has directly intervened in the MTN lawsuit or that his diplomatic role has been compromised. However, the optics of the situation—compounded by MTN’s high-profile legal battle and Jonas’s outspoken political history—have fueled public and media scrutiny, questioning the wisdom of his appointment and South Africa’s vetting process. The situation is further complicated by MTN’s strategic importance to South Africa’s economy and its global operations, which place it at the intersection of corporate, legal, and diplomatic spheres.

As of April 17, 2025, neither MTN, Jonas, nor the South African government has publicly addressed the conflict-of-interest allegations in detail. The lawsuit’s progression and Jonas’s diplomatic engagements will likely remain under close watch, with potential implications for MTN’s reputation, South Africa’s foreign policy, and U.S.-South Africa relations. The resolution of these issues could influence investor confidence in MTN, which has already faced challenges in maintaining its share price, and shape the broader narrative around corporate accountability in international law.

Conclusion

The Anti-Terrorism Act (ATA) lawsuit against MTN Group represents a pivotal moment at the intersection of international law, corporate accountability, and geopolitical dynamics. The U.S. federal court’s decision on April 15, 2025, to allow the case to proceed to the discovery phase signals that the plaintiffs—67 American Gold Star family members, servicemembers, and their families—have presented a compelling case under the ATA, as amended by the Justice Against Sponsors of Terrorism Act (JASTA) and the Anti-Terrorism Clarification Act (ATCA). The allegations that MTN Group knowingly or recklessly provided material support to Iranian entities acting as fronts for the Islamic Revolutionary Guard Corps (IRGC)—a designated terrorist organization—through funding, technology, and logistical assistance between 2011 and 2016, carry profound implications. This case not only threatens MTN’s financial stability and global reputation but also underscores systemic governance challenges in South Africa, raises questions about U.S.-South Africa relations, and sets a potential precedent for how multinational corporations are held accountable for indirect involvement in terrorism.

Legal Implications and Precedent-Setting Potential

From a legal perspective, the MTN lawsuit reinforces the extraterritorial reach of the ATA, demonstrating that U.S. courts are willing to hold foreign corporations accountable for actions abroad if those actions harm American nationals. The plaintiffs’ allegations align with precedents like Weiss v. National Westminster Bank PLC (2019) and Linde v. Arab Bank, PLC (2015), where secondary liability was established for entities that indirectly supported terrorism through financial or material assistance. The MTN case, however, is groundbreaking in its focus on a telecommunications company rather than a financial institution, and its emphasis on technology transfers—such as equipment and systems allegedly used by the IRGC to monitor U.S. military movements, communicate clandestinely, and enhance terrorist attacks. As Ryan Sparacino, a lawyer for the plaintiffs, noted, this ruling is a “first” for the ATA, marking a historic expansion of liability to telecom companies operating in high-risk regions.

The discovery phase will be crucial in determining the strength of the plaintiffs’ claims. If evidence emerges that MTN had actual knowledge of the IRGC’s terrorist activities—or even recklessly disregarded such risks—the company could face treble damages under the ATA, which multiplies the financial penalty threefold. Moreover, the case may encourage a wave of similar lawsuits against corporations operating in geopolitically sensitive areas, particularly those with lax compliance frameworks. This precedent could reshape corporate due diligence standards, forcing companies to more rigorously assess the risks of doing business with entities in countries like Iran, which is under heavy U.S. sanctions for its state-sponsored terrorism.

Corporate and Financial Risks for MTN

For MTN Group, the stakes are extraordinarily high. As one of Africa’s largest telecom operators, with a presence in over 20 countries, MTN has built a reputation as a leader in mobile communications and digital services. However, the ATA lawsuit threatens to unravel this success. Financially, the potential for substantial damages looms large, especially if discovery uncovers incriminating evidence such as internal communications or agreements that demonstrate MTN’s awareness of its Iranian partners’ terrorist links. There are major investor concerns that the lawsuit could lead to a significant decline in the company’s market value, as legal liabilities and reputational damage erode confidence.

Beyond financial penalties, the reputational fallout could be devastating. MTN’s alleged role in facilitating terrorism—even indirectly—may alienate customers, investors, and regulators in Western markets, where anti-terrorism compliance is a non-negotiable expectation. The company’s operations in Iran, particularly its partnership with Irancell, have long been controversial, and this lawsuit amplifies those concerns. MTN’s leadership, including chairman Mcebisi Jonas, will face intense scrutiny, especially given Jonas’s recent appointment as South Africa’s special envoy to the U.S. on April 14, 2025—just one day before the court’s ruling. This timing raises ethical questions about conflicts of interest and whether Jonas’s dual roles could compromise South Africa’s diplomatic efforts to mend ties with the U.S.

Geopolitical Ramifications and U.S.-South Africa Relations

The lawsuit exacerbates existing tensions between the U.S. and South Africa, which have already been strained by recent events, such as the expulsion of South Africa’s ambassador to the U.S. in March 2025. South Africa’s greylisting by the Financial Action Task Force (FATF) since February 2023 for deficiencies in anti-money laundering (AML) and counter-terrorism financing (CFT) frameworks further complicates the situation. The MTN case highlights systemic governance issues within South Africa’s corporate sector and it reinforces international perceptions of South Africa as a jurisdiction with weak oversight, potentially delaying its removal from the FATF greylist.

The possible involvement of high-level South African political figures adds another layer of complexity. If the discovery phase reveals ties between MTN’s actions and ANC top brass, it could implicate the South African government in facilitating or turning a blind eye to MTN’s dealings with Iranian entities. Such revelations would not only damage South Africa’s international standing but also undermine President Cyril Ramaphosa’s efforts to improve relations with the U.S., particularly through Jonas’s appointment as special envoy. The timing of Jonas’s appointment, juxtaposed with the court’s ruling, suggests either a lack of foresight or a deliberate attempt to mitigate the fallout—a move that may backfire if Jonas’s dual roles are perceived as a conflict of interest by U.S. officials.

Societal and Economic Impacts on South Africa

On a societal level, the MTN lawsuit underscores the broader challenges South Africa faces in combating corruption, money laundering, and terrorism financing—issues that contributed to its FATF greylisting ( South Africa’s high volume of crime, including tax crimes, bribery, corruption, and trafficking, which generate proceeds that fuel illicit activities). The MTN case, if proven, would illustrate how these systemic weaknesses enable corporate entities to engage in activities that have far-reaching consequences, including the loss of American lives in terrorist attacks. This could lead to increased scrutiny of South African businesses by foreign jurisdictions and financial institutions, as noted in the Cliffe Dekker Hofmeyr web result, potentially stifling investment and capital flows at a time when the country is already grappling with economic challenges.

Broader Implications for International Business and Counter-Terrorism

The MTN lawsuit serves as a cautionary tale for multinational corporations operating in regions with ties to terrorism or under international sanctions. The ATA’s broad liability framework, combined with the U.S.’s willingness to exercise extraterritorial jurisdiction, means that companies must prioritize robust compliance programs to avoid inadvertently supporting terrorist activities. This is particularly relevant for telecom companies, which play a critical role in providing infrastructure that can be exploited by malicious actors. The case may prompt other industries—beyond banking, which has historically been the focus of ATA lawsuits—to reassess their exposure to terrorism-related risks.

From a counter-terrorism perspective, the lawsuit highlights the importance of targeting the financial and logistical networks that enable terrorist organizations like the IRGC to operate. By holding corporations like MTN accountable, the U.S. sends a strong message that indirect support for terrorism will not be tolerated, even if the actions occur outside its borders. This approach aligns with broader U.S. efforts to disrupt terrorism financing, as seen in sanctions against Iran and designations of groups like the IRGC as foreign terrorist organizations.

Final Thoughts

In conclusion, the ATA lawsuit against MTN Group is a multifaceted case with far-reaching implications. Legally, it expands the scope of corporate liability for terrorism financing, potentially setting a precedent that will influence future litigation under the ATA. For MTN, the risks are immense—financial penalties, reputational damage, and operational challenges could reshape its future, particularly if the discovery phase uncovers evidence of complicity.

Geopolitically, the case strains U.S.-South Africa relations at a time when both nations are navigating already tense diplomatic waters, compounded by South Africa’s greylisting and governance challenges. Societally, it exposes the systemic issues that enable such activities to occur, urging South Africa to strengthen its AML/CFT frameworks to avoid further international isolation.

Finally, the case serves as a stark reminder to global corporations of the need for rigorous due diligence and compliance, especially in high-risk regions, to avoid the devastating consequences of being entangled in terrorism-related litigation. The outcome of the discovery phase will be a defining moment, not only for MTN but for the broader landscape of international business, counter-terrorism, and corporate accountability.