Buried in the most recent order, directed to counsel for the detained Halkbank officer, indicted for his role in the Iran sanctions evasion case, in US District Court in New York, is a curious question: are there any Americans who own Halkbank stock, and does the bank deserve punishment for its conduct ?
Though basically a Turkish government-owned financial institution, due to it majority ownership of bank stock, it appears, from a cursory look, that there are a small number of private shareholders. Halkbank is not OFAC-sanctioned, although it has been alleged that the bank was Zarrab's primary facilitator of his oil-for-gold thirteen billion dollar evasion scheme. This may be for political reasons, as Turkey is a NATO ally, and EU candidate for membership.
Are there American citizens or residents who own Halkbank stock, and how does this affect the case ? We cannot say, but should OFAC now name & shame the bank, those Americans, if there are owners of stock, would have some serious problems, and might be required to either unload their holdings, or have them seized. Anyway, why all this interest, from the trial judge, I wonder ?
Longtime readers of this blog may recall that we questioned, back in 2013, OFACs failure to name Reza Zarrab, as an SDN; it named his partner, Babak Morteza Zanjani, and the offshore shell bank that they controlled, First Islamic Investment Bank. As we regularly recount, OFAC is often late to the party, when it comes to sanctioning bad actors; will judicial interest in Halkbank, result in OFAC action ? Such a step will deny the bank access to the US financial system, and could drive it out of business. Will Halkbank be called to account for its actions, either in court, or as part of an administrative ruling ?
Though basically a Turkish government-owned financial institution, due to it majority ownership of bank stock, it appears, from a cursory look, that there are a small number of private shareholders. Halkbank is not OFAC-sanctioned, although it has been alleged that the bank was Zarrab's primary facilitator of his oil-for-gold thirteen billion dollar evasion scheme. This may be for political reasons, as Turkey is a NATO ally, and EU candidate for membership.
Are there American citizens or residents who own Halkbank stock, and how does this affect the case ? We cannot say, but should OFAC now name & shame the bank, those Americans, if there are owners of stock, would have some serious problems, and might be required to either unload their holdings, or have them seized. Anyway, why all this interest, from the trial judge, I wonder ?
Longtime readers of this blog may recall that we questioned, back in 2013, OFACs failure to name Reza Zarrab, as an SDN; it named his partner, Babak Morteza Zanjani, and the offshore shell bank that they controlled, First Islamic Investment Bank. As we regularly recount, OFAC is often late to the party, when it comes to sanctioning bad actors; will judicial interest in Halkbank, result in OFAC action ? Such a step will deny the bank access to the US financial system, and could drive it out of business. Will Halkbank be called to account for its actions, either in court, or as part of an administrative ruling ?
Chronicles of Monte Friesner - Financial Crime Analyst
Contributed by Kenneth Rijock - Financial Crime Consultant
