News

US charges Turkish bank with FRAUD, MONEY LAUNDERING, AND SANCTIONS evasion

16/10/2019

The Department of Justice announced that TÜRKİYE HALK BANKASI A.S., aka “Halkbank,” was charged today in a six-count indictment with FRAUD, MONEY LAUNDERING, AND SANCTIONS offenses related to the bank’s participation in a multibillion-dollar scheme to evade U.S. sanctions on Iran and

  • 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 IndictmentUS 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).