NEW YORK, Dec 19 (Reuters) - U.S. prosecutors on Tuesday urged a New York jury to find Mehmet Hakan Atilla, an executive at Turkey's majority state-owned Halkbank, guilty of helping Iran evade U.S. sanctions, while Atilla's lawyers said he was a "blameless pawn."
The closing arguments in Manhattan federal court capped off a three-week trial that has strained diplomatic relations between the United States and Turkey.
"This is a case about lies," Assistant U.S. Attorney Michael Lockard told the jury, saying Atilla lied to U.S. authorities that Halkbank was complying with sanctions.
Halkbank has denied involvement in illegal activities.
Lockard pointed to the testimony of Turkish-Iranian gold trader Reza Zarrab, who was charged in the case but pleaded guilty and testified for the prosecutors.
Zarrab testified that Atilla helped design fraudulent gold and food transactions that allowed Iran to spend its oil and gas revenues abroad, including through U.S. financial institutions, defying U.S. sanctions.
Atilla denied conspiring with Zarrab while testifying in his own defense during the trial.
Lockard said Zarrab's testimony was supported by other evidence, including an April 2013 message in which Halkbank's then-general manager, Suleyman Aslan, asked Zarrab if he had any problem with "the method proposed by Hakan Atilla."
Attempts by Reuters to reach Aslan for comment have been unsuccessful.
Lockard also said that Zarrab's scheme continued even as Aslan and others at the bank were replaced.
"The only person who's been involved at every step is Mr. Atilla," he said.
Atilla's lawyer, Victor Rocco, said Zarrab was not credible. He noted that Zarrab had hired prominent American lawyers to try to negotiate his release through diplomacy, and said he decided to turn on Atilla after that failed.
"Hakan Atilla is a blameless pawn, collateral damage in a story that belongs in The Twilight Zone, not in American court," Rocco said.
Rocco argued that evidence pointed to Atilla's innocence. He cited a call in which Zarrab told one of his employees that Atilla "threw a wrench in the gears," but that Zarrab resolved the problem by going to Aslan.
Rocco also pointed to an April 2013 call in which Zarrab said he lied to Atilla, even though Zarrab had said Atilla was already in on the scheme by October 2012.
"If in October of 2012 Hakan Atilla was part of a conspiracy with Zarrab, why is Zarrab lying to him six months later?" Rocco asked.
U.S. prosecutors charged nine people in the criminal case, though only Zarrab, 34, and Atilla, 47, have been arrested by U.S. authorities.
U.S. District Judge Richard Berman is expected to instruct the jury Wednesday morning, after which jurors will begin deliberating on the case. (Reporting By Brendan Pierson in New York; editing by Clive McKeef)