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Turkey Slams U.S. Iran Sanctions Case As 'Legal Scandal'

U.S. prosecutors accused banker Mehmet Hakan Atilla (left) of conspiring with Turkish-Iranian gold trader Reza Zarrab (right) to help Iran evade sanctions.
U.S. prosecutors accused banker Mehmet Hakan Atilla (left) of conspiring with Turkish-Iranian gold trader Reza Zarrab (right) to help Iran evade sanctions.

Turkish President Recep Tayyip Erdogan's spokesman has condemned a demand by U.S. prosecutors that a Turkish Halkbank executive get 20 years in prison for helping Iran evade U.S. sanctions.

"We strongly condemn and reject this decision, it is a grave injustice," spokesman Ibrahim Kalin told a news conference in Istanbul on April 5 when asked about the sentencing recommendation by U.S. attorneys for Halkbank executive Hakan Atilla, who was found guilty of evading sanctions on Iran by a U.S. jury in January.

"The Hakan Atilla case is a legal scandal," Kalin said.

Erdogan earlier this year called the case "an attempt to stage a new coup" in Turkey because two witnesses for the prosecution testified that high-level Turkish officials and Erdogan himself were involved in the scheme to help Iran launder revenues derived from oil sales in global financial markets in violation of U.S. sanctions.

U.S. prosecutors accused Atilla, 47, of conspiring with Turkish-Iranian gold trader Reza Zarrab from 2010 to 2015 to help Iran evade sanctions by disguising the oil sales as fraudulent gold trades and food-aid transactions.

"At a time when the United States and the community of nations were engaged in the momentous undertaking of depriving the government of Iran of funding for its malign and deadly activities," including its alleged pursuit of nuclear weapons and support for terrorist groups, "Atilla was a key player in massively undermining those efforts," prosecutors said in a court filing.

Iran has denied pursuing nuclear weapons or supporting terrorists. The case exposed, however, how high-level Iranian officials allegedly maneuvered to get around U.S. sanctions which prohibit Tehran from using the U.S. dollar or U.S. financial institutions in global trade.

Atilla is to be sentenced on April 11 by U.S. District Judge Richard Berman in Manhattan.

In a court filing last week, Atilla's lawyers urged leniency, saying the case did not involve "economic crimes" or a "crime of American disloyalty" by their client, a Turkish national, and that "no victims" suffered a financial loss.

They also said a lengthy sentence would keep Atilla, who has been detained by U.S. authorities already for a year, more than 8,000 kilometers away from his wife and only son for too long.

Nine defendants have been charged in the case, but most of the others reside in Turkey and remain at large.

Zarrab pleaded guilty and became the star witness against Atilla, describing in several days of trial testimony a wide-ranging scheme to bribe Turkish officials and evade sanctions, which he said was carried out with the blessing of Erdogan.

Zarrab agreed to cooperate with the U.S. government in hopes of getting leniency at his own sentencing in the high-profile case.

His chances of getting a lighter sentence appeared to be jeopardized on April 5, however, when prosecutors leveled new charges alleging that Zarrab's lawyer offered a prison guard $45,000 in bribes to provide him with cell phones and alcohol while he was in jail awaiting trial.

With reporting by AP and Reuters