Turkey’s Halkbank argues immunity from prosecution at U.S. court

Turkey’s state-run Halkbank, facing charges of helping Iran evade U.S. sanctions, argued in a federal court in New York that it was immune from prosecution, Reuters reported on Tuesday.

Halkbank’s lawyer Simon Latcovich said that the bank was “synonymous” with Turkey and therefore fell under the protections offered in the federal Foreign Sovereign Immunities act, Reuters said.

While Latkovich argued that sovereigns were “immune even in criminal cases”, U.S. prosecutor Sidhardha Kamaraju said that the law only applied to civil cases, according to Reuters.

Halkbank is accused of bank fraud, money laundering and conspiracy over its involvement in a plot to trade gold for Iranian oil and natural gas, helping Tehran evade U.S. sanctions imposed over its nuclear programme. It has pleaded not guilty to the charges.

Kamaraju urged the court to reject a “dramatic extension” of FSIA, Reuters said.

Courts are not where sovereigns settle disputes, courtroom reporter Matthew Russel Lee cited Latcovich as saying during Monday’s hearing.

Latcovich argued for Halkbank’s immunity based on it “collecting taxes for the government”, and its majority shares being owned by the state.

“Would the officers of the bank enjoy diplomatic immunity?” asked one of the court’s judges, according to Lee. When Halkbank’s lawyers said they would not, the judge went on to ask: “So how is the bank synonymous with the Turkish state?”

Judge Cabranes: Would the officers of the bank enjoy diplomatic immunity?
Halkbank's lawyer: I don't believe so...
Judge Cabranes: So how is the bank synonymous with the Turkish state?
Halkbank: That's not an FSIA question.

— Inner City Press (@innercitypress) April 12, 2021

“Halkbank would have this court believe Congress wanted to immunise foreign sovereigns,” Lee cited Kamaraju as saying.

The court did not issue a ruling during the hearing and did not say when it would.