U.S. judge overseeing sanctions-busting case against Halkbank will not recuse himself

Turkish state-run lender Halkbank has failed in an attempt to force the U.S. judge overseeing a criminal case accusing it of helping Iran evade U.S. sanctions to recuse himself, Reuters reported on Monday.

U.S. District Judge Richard Berman in Manhattan said in an order on Monday that Halkbank’s motion had no substantive merit and rejected claims by the bank that he was not impartial, it said.

Halkbank co-defendant Reza Zarrab failed in a bid to force Berman to withdraw from a similar case four years ago, the judge said, according to Reuters.

Zarrab, a Turkish-Iranian gold trader, was convicted in 2018 of helping Iran evade the sanctions. Berman also oversaw that case.

“Halkbank’s recusal motion is a belated rerun of the Zarrab recusal motion, supplemented by 1,014 additional pages of exhibits and two purported expert declarations,” Reuters cited the judge as saying.

Halkbank stands accused of laundering up to $20 billion on behalf of Iranian entities, bank fraud charges and concealing the nature of these illicit transactions from U.S. officials.

On March 31, Halkbank pleaded not guilty to bank fraud, money laundering and four conspiracy charges.

A trial date has been set for March 1, 2021.

Separately, U.S. Senator Ron Wyden urged John Bolton, President Donald Trump’s former national security adviser, to participate in a session by the Senate’s Finance Committee to discuss statements from his 2020 book regarding Trump’s involvement in the Halkbank case, U.S.-based Courthouse News reported on Monday.

In his book “The Room Where It Happened”, released in June, Bolton said that Trump tried to scuttle the sanctions-busting investigation into Halkbank as a favour to Turkish President Recep Tayyip Erdoğan in 2018.

“In connection with this investigation, I request that Amb. Bolton provide all relevant records including, but not limited to, notes, documents, and electronic communications - related to these matters and the allegations made in his book concerning them,” Courthouse News cited Wyden as saying in a letter to Bolton’s attorney.

“I also request that he participate in a voluntary, transcribed, staff interview at a mutually convenient date and time.” 

Wyden wrote that Trump instructed Treasury Secretary Steven Mnuchin to interfere in the matter and said Bolton asserted that on more than one occasion the Justice Department was aware of Mnuchin’s efforts to halt the Halkbank investigation.