US charges Turkish bank with Iran sanctions evasion

The US Department of Justice has announced charges against Halkbank, a Turkish state-owned bank, for conspiring to circumvent US sanctions against Iran by facilitating a scheme allowing Iran access to the US financial system, and avoid restrictions on the proceeds of oil and gas sales and the supply of gold. See DOJ Press Release and the Indictment, US v Turkiye Halk Bankast A.S, S6 15 Cr. 867 (RMB).

The allegation is that since Iran could not access proceeds from oil and gas sales to Turkey, Halkbank allowed funds deposited at the bank to be used to buy gold for the benefit of the Iranian government, which was not subsequently exported to Iran, and facilitated transactions for food and medicine, so they could fall under the humanitarian exception to certain sanctions, when, according to the DOJ, no purchases were actually made. As a result, Halkbank transferred approximately $20bn of Iranian funds, which otherwise would have been restricted by US sanctions.

The DOJ has previously charged 9 defendants for participating in the scheme. Reza Zarrab and Memet Hakken Atilla were both convicted in 2017 and 2018, (see post and post).

IranIran United StatesUnited States

About Maya Lester QC

Maya Lester QC

Maya Lester QC is a senior barrister (Queen’s Counsel) at Brick Court Chambers with a wide-ranging practice in public law, European law, competition law, international law, human rights & civil liberties. She has a particular expertise in sanctions. The legal directories say she is the...

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