Ilhan Tanir
Feb 22 2018

New sealed documents create speculations around Zarrab case

Two sealed documents have been added to the trial of Reza Zarrab, a Turkish-Iranian gold trader who admits to playing a central role in a scheme to contravene U.S. sanctions on Iran.

Zarrab gave startling testimony in December during the trial of Mehmet Hakan Atilla, an executive at the Turkish state-owned Halkbank, the bank through which funds were moved for Iran. Zarrab’s statements implicated Turkish President Recep Tayyip Erdoğan, who he said had given the green light for the scheme to go ahead, and former Economy Minister Zafer Çağlayan, who he alleged had taken millions of dollars in bribes.

Zarrab has been held in the United States since March 2016, when he was arrested after flying to Miami with his family, apparently to visit Disney World. 

The addition of two sealed documents to the court’s files on the “USA v Zarrab et al” case on Thursday has sparked speculation that a new charge sheet is being prepared. Zarrab, during his testimony, admitted that he had submitted documents and information about other people, apart from Mehmet Hakan Atilla. 

Zarrab, during the cross-examination at the court acknowledged that he agreed to give U.S. officials sufficient information and evidence to start investigations into other persons involved in the scheme as a part of his plea deal.

It is widely expected that as a result of Zarrab's confessions to U.S. authorities, there will be more charges filed and possibly new indictments revealed in the coming months or years. Now the speculation is that these two sealed documents added to the U.S. v. Zarrab case could be an indictment. 

During his cross-examination, Zarrab said that co-operating by giving information and evidence was a pre-condition for the plea deal and his 5K-1 letter.

During the first trial, the judge granted the defence access to redacted copies of government evidence through a protective order in which a witness or defendant, ‘Individual-1” was mentioned. The public was only able to learn that Zarrab was "Individual-1" and a state witness when the trial began. 

To issue an indictment, the grand jury does not make a determination of guilt, but only the probability that a crime has been committed, and that the accused person should be tried for it. Indictments are often kept under seal so as not to alert the accused. Zarrab, when arrived in Florida with his family, had no knowledge that there was a federal indictment on him. 



Zarrab 1
Zarrab 2

Alternatively, either the defence or prosecution lawyer may have submitted documents they have requested be kept secret.

Before giving his incendiary testimony, the gold trader had opened a number of cases in Turkey against people he said had slandered him. A news report on Thursday said that his Turkish lawyers have resigned from one of these cases.

Turkey moved to seize the assets of Zarrab and his relatives a day after the multi-millionaire took the witness stand in New York.

Zarrab’s whereabouts had previously become a mystery when the Federal Bureau of Prisons updated his inmate profile to show him as “released” from a detention centre in Brooklyn in early November. That was a clue that Zarrab had become a state witness spilling the beans on President Recep Tayyip Erdogan, his allies and family. 

Zarrab told the court that he paid Çağlayan around 45-50 million euros, $7 million and almost 2.5 million Turkish lira.

Zarrab said during his testimony that Erdoğan and a close relative had been behind his decision to restart his billion-dollar oil-for-gold trade with Iran after being freed from a Turkish jail in 2014.

Erdoğan said the U.S. case was a conspiracy conducted by a fake court to undermine his country politically and economically.

During the trial Zarrab made serious accusations against Aktif Bank, a company owned by the Çalık Holding, one of Turkey’s largest conglomerates. Erdoğan’s son-in-law Berat Albayrak was CEO of Çalık Holding from 2007 to 2013. He is now energy minister. Another bank accused was Arab & Türk Bank (A&T Bank). According to Zarrab's testimony, the bank received transfers in Turkish lira from Halkbank in order to conceal the fact that the funds had originated in Iran. The heaviest accusations, however, levelled against publicly held Halkbank.