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Turkish Banker Denies Helping Iran Evade U.S. Sanctions In High-Profile Case


Turkish-Iranian businessman Reza Zarrab (right) and banker Mehmet Hakan Atilla (file photo)

An executive at Turkey's state-owned Halkbank has denied that he helped Iran evade U.S. sanctions as he took the witness stand in his defense in a high-profile sanctions case unfolding in New York.

Mehmet Hakan Atilla in the third week of his trial on December 15 told jurors that he "never" conspired with his fellow defendant, Turkish-Iranian businessman Reza Zarrab, to launder an estimated $1 billion in Iranian oil revenues through U.S. banks in violation of the sanctions, as U.S. prosecutors have charged.

Zarrab pleaded guilty last month under a cooperation deal with U.S. prosecutors and testified earlier in the trial that he masterminded the sanctions evasion scheme and bribed high-level Turkish officials to carry it out.

U.S. prosecutors have charged nine people in all with conspiring to help Iran evade sanctions through fraudulent gold and food-aid transactions. Only Zarrab, 34, and Atilla, 47, were arrested by U.S. authorities. The other defendants, mostly Turkish businessmen and officials, remain at large.

Responding to questions in court from one of his lawyers, Atilla directly contradicted some of the evidence presented earlier in the trial.

Zarrab had told the jury that he saw Atilla's superior call Atilla on an afternoon in April 2013 and order him to authorize an illicit transaction. Atilla testified that he was on a plane at the time.

Atilla also said that a recorded phone call played in court, purportedly between him and Zarrab, was actually between Zarrab and another Halkbank employee.

Earlier this week, Atilla's lawyers asked U.S. District Judge Richard Berman in Manhattan to order a mistrial following testimony from a former Turkish police investigator, Huseyin Korkmaz, who led a Turkish investigation into Zarrab's alleged Iran sanctions evasion scheme in 2012-13.

The attorneys said Korkmaz's testimony that his investigation was quashed by the Turkish government and he fled the country to avoid retribution had unfairly tarred Atilla, the sole remaining defendant in the New York case, by associating him with "cruel political violence."

The judge, without the jury present, denied the request for a mistrial on December 15. He said Korkmaz had actually helped Atilla's case by testifying that Atilla was never caught on surveillance videos or found taking bribes in his 2013 investigation.

The judge criticized the defense attorneys for raising the issue of possible links between Korkmaz and Fethullah Gulen, a U.S.-based Muslim cleric blamed by the Turkish government for last year's failed coup against Erdogan.

Berman said it was "unpersuasive and borderline unprofessional" to bring up what he called an "illogical foreign conspiracy theory" in court.

Erdogan has sought extradition of Gulen to face charges in connection with the aborted coup, but U.S. officials have rebuffed the request, citing a lack of evidence. Gulen denies the accusations against him.

Atilla's attorney, Todd Harrison, said he disagreed with the judge's criticism about bringing up the Gulen connection in court, though Korkmaz has denied having any ties or allegiance to Gulen. "I think it was a legitimate cross-examination," Harrison said.

The case has strained ties between the United States and Turkey. A spokesman for the Turkish government has called the case a "plot against Turkey" and Erdogan personally lobbied the White House for the release of Zarrab and Atilla earlier this year.

Both Zarrab and Korkmaz, who now lives in exile in the United States, in their testimony implicated high-level Turkish officials, including Erdogan, for involvement in the alleged sanctions-evasion scheme.

Erdogan has not responded to their accusations, but he has repeatedly dismissed the case as a politically inspired attack on his government.

Turkish Justice Minister Abdulhamit Gul on December 15 demanded the extradition of Korkmaz in a letter to U.S. Justice Secretary Jeff Sessions, calling him a "terror suspect facing serious allegations."

Turkish officials often call followers of Gulen "terrorists" and have charged that Korkmaz is one of them, though he testified in court that he is not.

With reporting by AP and Reuters
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