US Attorney’s Office vows to prove cooperation of high level Turkish and Iranian officials with Zarrab to evade US sanctions

(From left to right) US President Donald Trump, Rudolph Giuliani, Reza Zarrab, Turkey's autocratic President Recep Tayyip Erdoğan.

The New York District General Attorney’s Deputy Michael Lockart has urged that as the  Attorney’s Office they “will prove the cooperation and coordination between high-level Turkish and Iranian officials with Turkish/Iranian gold trader Reza Zarrab to evade US sanctions.”

According to a news report published by Washington Hattı news portal, during a court hearing on Monday, Lockart surprised the Zarrab’s defense team by making this unexpected declaration.

In an affidavit the court received last week, Zarrab’s lawyer and Former Mayor of New York City and close US President Donald Trump associate Rudolph Giuliani has claimed that none of the transactions Zarrab is alleged to have participated “involved weapons or nuclear technology, or any other contraband, but rather involved consumer goods.”

Giuliani and attorney general under the George W. Bush administration Michael Mukasey were added last month to the legal team of Reza Zarrab, a Turkish-Iranian businessman who is awaiting trial on charges of violating US sanctions on Iran, have been working to resolve the case with Trump administration officials and the Turkish government instead of the US attorney’s office that is prosecuting him, according to a report in The New York Times on April 2.

Giuliani and Mukasey were reportedly bypassing the US Attorney’s Office for the Southern District of New York in efforts to negotiate a deal for their new client. The two men have also traveled to Turkey to meet with Turkey’s autocratic President Recep Tayyip Erdoğan to discuss a potential resolution of the case, with the knowledge of current Attorney General Jeff Sessions, court filings indicate.

According to the report written by journalist İlhan Tanır for Washington Hattı, on Monday, the New York District Attorney’s office gave a hard time to Giuliani and reminded the court that Zarrab -in the second indictment -, had helped the Iran’s Revolutionary Guards in Syria and Iraq noting that this is a US national security matter.

Journalist Tanır previously wrote that the Southern District of New York District Attorney’s office was disturbed by Giuliani’s role as a “mediator” in Zarrab case. The chief public prosecutor reminded the precise nature of the accusations against Zarrab asked the court to recognize the weight of the charges. The chief prosecutor also pointed out that the prosecution will prove that Reza Zarrab, cooperated with Iranian and Turkish senior officials to evade the Iranian sanctions.

Mehmet Hakan Atilla, Deputy CEO of state largest lender Halkbank who was arrested in New York and Reza Zarrab appeared together before the court. Atilla was also present, however two suspects did not talk to each other during the hearing. After the trial, Atilla turned to the journalists and pleaded, “I want all of Turkey to know that I have no involvement in this.”

Atilla was arrested by the agents of Federal Information Bureau (FBI) at John F. Kennedy Airport in New York City on March 27. Atilla was accused of conspiring with controversial Iranian-Turkish businessman Reza Zarrab “to evade US sanctions against Iran and 0ther offenses.” According to a written press statement released by Joon H. Kim, the Acting United States Attorney for the Southern District of New York, “the unsealing of a Complaint charging Mehmet Hakan Atilla with conspiring with others, including Reza Zarrab, (a.k.a Rıza Sarraf) to use the US financial system to conduct transactions on behalf of the Government of Iran and other Iranian entities, which were barred by United States sanctions, and to defraud US financial institutions by concealing the true nature of these transactions.”

Kim also stated that: “As alleged, Mehmet Hakan Atilla, a Turkish banker, participated in a years-long scheme to violate American sanctions laws by helping Reza Zarrab, a major gold trader, use US financial institutions to engage in prohibited financial transactions that illegally funneled millions of dollars to Iran. As alleged in the criminal complaint unsealed today, Atilla worked with Zarrab to create and use fraudulent documents to try to disguise prohibited Iranian financial transactions as food that would qualify under the humanitarian exception to the sanctions regime. United States sanctions are not mere requests or suggestions; they are the law. And those who use the American financial system to violate the sanctions laws, as Atilla is alleged to have done, will be investigated and prosecuted aggressively. I thank the FBI and the career prosecutors in my Office for their tireless work and dedication in this and other important investigations of alleged sanctions violators.”

Zarrab’s trial in the US has drawn much attention in Turkey as he was briefly detained in 2013 along with others from the inner circle of the ruling Justice and Development Party (AKP) government and then-Prime Minister Erdoğan for having paid Cabinet-level officials and bank officers bribes to facilitate transactions benefiting Iran.

After Erdoğan cast the case as a coup attempt to overthrow his government orchestrated by his political enemies, several prosecutors were removed from the case, police were reassigned and the investigation against Zarrab was dropped.

When he arrived in Miami in March 2016 for a holiday in Florida with his wife and daughter, Zarrab was arrested at the airport as part of an investigation by Preet Bharara, then-US attorney for the southern district of New York.

In December, Bharara, who indicted Zarrab on charges of violation of US sanctions on Iran, added new evidence to his indictment, claiming Deutsche Bank and Bank of America were swindled by Zarrab.

According to the indictment, Bharara claimed that Zarrab, 33, participated in transactions to benefit Iran-based Mahan Air, which the US government has sanctioned for providing services to Iran’s Quds Force as well as Hezbollah.

April 24, 2017

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