Levent Kenez/Stockholm
At a parliamentary committee meeting at which the budget negotiations of state-owned Turkish lender Halkbank were held on June 16, opposition deputies supported Halkbank, which is accused of facilitating the violation of US sanctions on Iran , and, using the same discourse as the government, argued that the case was political and ill-intentioned.
On December 17, 2013, Turkish prosecutors made a graft investigation public in which Iranian-Turkish businessman Reza Zarrab and the inner circle of then-prime minister Recep Tayyip Erdoğan, including some cabinet ministers, were incriminated. According to the investigation, Turkey helped Iran evade US sanctions through Halkbank, which has been indicted in a New York federal court. It was also revealed that Erdoğan, his family members and leading ministers collaborated with Zarrab. Pursuant to an agreement with the US, Turkey was allowed to sell food to Iran, which would fall under the humanitarian exemption to the sanctions, but the documents were falsified and instead gold and cash went to Iran in return for natural gas. Halkbank was also used as an intermediary agent.
In his speech at the committee meeting, main opposition Republican People’s Party (CHP) lawmaker Atilla Sertel, a former journalist, stated that they found the case against Halkbank in the United States regrettable for Turkey and that his party agrees that it is political. Sertel also recalled Turkish Foreign Minister Mevlüt Çavuşoğlu’s meeting with US Secretary of State Antony Blinken on May 19 in which Çavuşoğlu conveyed Turkey’s expectations regarding the Halkbank case and then asked why no further explanation was made.
Political observers claim that among the other things Turkey has demanded from the administration of US President Joe Biden in return for the approval of Sweden and Finland’s NATO membership is the termination of the Halkbank case.
Another opposition deputy, Bedir Yaşar of the Good (İYİ) Party, argued that global powers have certain sanctions on Halkbank and requested information about the case from the Halkbank general manager, who was present at the meeting.
“By the way, we are with Halkbank until the end. We hope this is a political case and that the bank doesn’t have much to do with these allegations,” Yaşar said.
Yaşar also claimed that the prosecution in the US poses a threat to the bank and that it will definitely cause certain problems in both finding and creating credit in international markets.
Despite the the deputies’ statement of support, Halkbank General Manager Osman Arslan did not answer any questions about the case in the US and stated that he would send them the written answers later.
Describing the case as political, the Erdoğan government argues that Halkbank has immunity from prosecution in the US because it is a state bank. However, a US court on October 23, 2021 denied an appeal from Halkbank, which had asked the court to block the trial and argued it had sovereign immunity under US law. The judge said the charges “fall under the commercial activity exception” to the Foreign Sovereign Immunities Act.
In 2019 US federal prosecutors in the Southern District of New York indicted Halkbank on six counts including fraud, money laundering and sanctions offenses related to the bank’s participation in a multibillion-dollar scheme to evade US sanctions on Iran.
According to the indictment Halkbank is charged with conspiracy to defraud the United States, conspiracy to violate the International Emergency Economic Powers Act (IEEPA), bank fraud, conspiracy to commit bank fraud, money laundering and conspiracy to commit money laundering.
Between 2012 and 2016, prosecutors alleged that Halkbank and its officers, agents and co-conspirators directly and indirectly used money service businesses and front companies in Iran, Turkey, the United Arab Emirates and elsewhere to violate and to evade and avoid prohibitions against Iran’s access to the US financial system, restrictions on the use of proceeds of Iranian oil and gas sales and restrictions on the supply of gold to the government of Iran and to Iranian entities and persons.
Halkbank knowingly facilitated the scheme, participated in the design of fraudulent transactions intended to deceive US regulators and foreign banks and lied to US regulators about Halkbank’s involvement, the indictment states.
US federal prosecutors previously charged nine individual defendants, including bank employees, the former Turkish economy minister and other participants in the same scheme. On October 26, 2017 Reza Zarrab, the key suspect in the case, pled guilty to the seven counts with which he was charged. He became a government witness who confessed he had bribed Turkish government officials.
Hakan Atilla, the former deputy general manager of Halkbank who was convicted of conspiring to violate US sanctions on Iran by the US District Court for the Southern District of New York was sentenced to 32 months in prison. Atilla returned to Turkey on July 23, 2019 from the US, where he had been jailed for 28 months. During the trial, Atilla acknowledged that transactions were made through Halkbank to circumvent US sanctions on Iran but said he did not personally obtain any financial gain.
Minutes of the the committee meeting on June 16, 2022:
