While Iran is undoubtedly up to myriad nefarious shenanigans, this report may simply be the result of media sensationalism as its source, The National Post, is an expressly conservative publication.
Their parliament is elected democratically, even though undemocratically many reformists were disqualified from running in the last election. I suppose if there's enough of a Jewish population then it's entirely possible. Wikipedia seems convinced, at least: http://en.wikipedia.org/wiki/Maurice_Motamed.
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And you are correct!
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http://www.cnn.com/2006/WORLD/americas/05/24/canada.iran.reut/index.html
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