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Turkish gold trader testifies on bank exec's role in sham food sales
December 1, 2017 / 9:41 PM / 13 days ago

Turkish gold trader testifies on bank exec's role in sham food sales

    By Brendan Pierson
    NEW YORK, Dec 1 (Reuters) - A Turkish-Iranian gold trader
testifying for U.S. prosecutors in a New York court on Friday
gave his most detailed account yet of how he claims an executive
of Turkey's state-owned Halkbank            devised key parts of
a plan to launder money for Iran through fake food sales.
    The executive, Mehmet Hakan Atilla, is on trial on charges
that he took part in a scheme to violate U.S sanctions against
Iran. The gold trader, Reza Zarrab, pleaded guilty in the case
and agreed to cooperate with the prosecutors.  
    U.S. prosecutors have charged nine people, although only
Zarrab, 34, and Atilla, 47, have been arrested by U.S.
authorities. Victor Rocco, a lawyer for Atilla, told jurors in
his opening statement on Tuesday that Atilla was innocent.
    On Friday, Zarrab testified that Atilla played an important
role in a scheme to let Iran spend its oil and gas revenue
abroad through gold trades and sham food sales.
    Zarrab said the scheme shifted from gold trades to purported
food sales, in which no food was sent to Iran, after U.S.
sanctions changed in 2013.
    Zarrab testified on Thursday that Atilla was initially not
receptive to the food scheme, and did not understand that the
food sales were fake.
    However, Zarrab said on Friday that Atilla eventually came
up with some features of the food transactions himself, such as
moving money from one of Zarrab's companies to another to
conceal the link to Iran.
    Zarrab said Atilla later identified a "loophole" that
allowed Iran to use gas revenue, but not oil revenue, to buy
gold.
    Halkbank has said all of its transactions complied with
national and international regulations.
    Over three days of testimony, Zarrab has implicated top
Turkish politicians, including President Recep Tayyip Erdogan.
Zarrab said on Thursday that Erdogan personally authorized two
Turkish banks to join the scheme when he was prime minister.
            
    A spokesman for Erdogan could not immediately be reached.
Turkish Prime Minister Binali Yildirim said on Friday that the
U.S. case was an attempt to undermine Turkey's economy.
            
    After the jurors left on Friday, U.S. District Judge Richard
Berman said he intended to dismiss one of the jurors who
appeared to be "really sound asleep" through much of the
testimony.

 (Reporting By Brendan Pierson in New York; Editing by Alden
Bentley and Bill Rigby)
  

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