Reuters – 7 September 2017, Thursday
By Daren Butler and David Dolan
ISTANBUL - U.S. prosecutors have charged a former Turkish economy minister and the ex-head of a state-owned bank with conspiring to violate Iran sanctions by illegally moving hundreds of millions of dollars through the U.S. financial system on Tehran’s behalf.
The indictment marks the first time an ex-government member with close ties to President Tayyip Erdoğan has been charged in an investigation that has strained ties between Washington and Ankara. Ex-minister Zafer Çağlayan was also charged with taking bribes in cash and jewelry worth tens of millions of dollars.
The charges stem from the case against Reza Zarrab, a wealthy Turkish-Iranian gold trader who was arrested in the United States over sanctions evasion last year. Erdogan has said U.S. authorities had “ulterior motives” in charging Zarrab, who has pleaded not guilty.
Prosecutors have now charged Çağlayan and former Halkbank general manager Süleyman Aslan and two others, according to the U.S. Attorney’s Office for the Southern District of New York.
They were charged with “conspiring to use the U.S. financial system to conduct hundreds of millions of dollars’ worth of transactions on behalf of the government of Iran and other Iranian entities, which were barred by United States sanctions,” U.S. prosecutors said in a statement dated Wednesday.
They were also accused of lying to U.S. government officials about the transactions, laundering funds and defrauding several financial institutions by concealing the true nature of the transactions, prosecutors said.
Reuters was not immediately able to reach Çağlayan or Aslan for comment. Halkbank said all of its transactions have always fully complied with national and international regulations, adding that news regarding the U.S. case “misleads” the public and investors.
Relations between Washington and NATO ally Turkey, an important partner in tackling the Syrian conflict, were strained after a failed coup against Erdoğan in July last year and the president’s subsequent crackdown on opposition.
Ankara is seeking, so far without success, extradition of a U.S.-based Muslim cleric it accuses of backing the coup attempt.
The cleric, Fethullah Gülen, denies the allegation.