By Brendan Pierson

NEW YORK, June 29 (Reuters) - A jury in New York on Thursday found that the U.S. government can seize a Manhattan office building from a nonprofit foundation accused of violating U.S. sanctions against Iran.

The jury in a federal court in Manhattan said the Alavi Foundation, majority owner of an office tower at 650 Fifth Avenue, knew that its partner and the building's minority owner, Assa Corp, was a front for Iran, and helped conceal that fact.

Jurors agreed the government had proven that the property was involved in or traceable to money laundering.

The government wanted to seize the 36-story building, which could be worth nearly $1 billion, to benefit people with judgments against Iran relating to bombings and other attacks.

Alavi was founded in 1973 as the Pahlavi Foundation by the then-Shah of Iran, Mohammad Reza Pahlavi. It describes its mission as promoting the study of Persian and Islamic culture in the United States, and also funds schools and free clinics.

The tower at 650 Fifth Avenue was built at the shah's behest in 1978 to provide a source of income. After the Islamic Revolution in 1979 that ousted the shah, Iran's new government replaced much of Alavi's board of directors. (Reporting By Brendan Pierson in New York; editing by Jonathan Oatis)

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