US prosecutors this week asked a federal court to dismiss criminal charges against Halkbank over Iran sanction violations after the Turkish bank completed a compliance review, according to court papers.
The move comes on the heels of a March deferred prosecution agreement in which the US Justice Department highlighted diplomatic benefit of resolving the case. Officials cited the Turkish government’s assistance in securing both the release of Israeli hostages in Gaza and a ceasefire in the war-torn Palestinian territory.
In a June 10 joint request to US District Judge Richard Berman co-signed by Halkbank counsel, US Attorney Jay Clayton said the bank’s compliance obligation “has been satisfied,” according to a 12-page letter.
“The government thus moves to dismiss the charges in the indictment as to Halkbank with prejudice.”
US prosecutors had hit Halkbank with criminal charges in 2019 over suspicions it was involved in a years-long scheme to launder billions of dollars’ worth of Iranian oil and natural gas proceeds in violation of sanctions on Tehran.
The Department of Justice had slapped Halkbank with six counts of fraud, money-laundering and sanctions offenses in what it had referred to as one of the most serious sanctions-busting cases it had seen.
To fulfill the deferred prosecution agreement’s requirements, Halkbank enlisted a Turkish affiliate of accounting firm Ernst & Young to review the bank’s compliance program and check whether any transactions were for the benefit of Iran or Iranian persons or entities.
The review identified “no findings of noncompliance,” the letter said.
Ernst & Young discovered there transaction requests made by a customer related to Iran, but the bank did not process any of them, the letter said.
Halkbank said that the case could be entirely resolved soon.
“With the US Southern District Court of New York’s approval of the joint petition to dismiss the criminal case in a short time, the criminal case, which has been ongoing for nine years, will be completely concluded,” Halkbank said in a statement to AFP.
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