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Report: Zarrab not yet revealed ‘most important name’ in sanctions-busting scheme

Detained Azerbaijani businessman Reza Zarrab (C) is surrounded by journalists as he arrives at a police center in Istanbul on December 17 ,2013. Turkish police detained more than 20 people including the sons of three cabinet ministers and several high-profile businessmen on December 17 in a probe into alleged bribery and corruption, local media reported. Prime Minister Recep Tayyip Erdogan's ruling Justice and Development Party (AKP), which boasts of being pro-business, has pledged to root out corruption, a chronic problem in Turkey. AFP PHOTO / OZAN KOSE / AFP PHOTO / OZAN KOSE

Main opposition Republican People’s Party (CHP) deputy Erdal Aksünger has stated that Turkish-Iranian gold trader Reza Zarrab, who has been held in a New York prison since March 2016 for violating US sanctions against Iran, recently said he had not yet shared the names of all the Turkish officials who he bribed including “the most important one,” the Cumhuriyet daily reported on Sunday.

“I have not shared the names of all the officials I bribed. It even includes the most important person as well,” Zarrab said during a meeting with his lawyer in the US two weeks ago, Aksünger said during a radio program on RS FM.

“When I was detained [in 2016] [Turkish officials] told me not to talk and that they would get me freed as soon as possible. When I talked [reached a plea deal with the prosecution], they [Turkish officials] tried to kill me. I was attacked with a knife. In order to prevent me from talking more and to punish me, they won’t allow my daughter to leave Turkey and visit me,” Zarrab said according to Aksünger, reading from the notes of the lawyer who met with the Turkish-Iranian gold trader.

When Zarrab revealed his tactics and accomplices within the Turkish government in violating US sanctions on Iran in New York federal court in November, Turkey seized the assets of Zarrab and his relatives.

The property of Zarrab and his family members was seized as part of an investigation into espionage and providing confidential state information to a foreign government, launched by the İstanbul Public Prosecutor’s Office. The decision was taken as a measure to prevent Zarrab from smuggling his property out of Turkey.

The names of 23 people including Zarrab’s daughter and other relatives and members of his close circle were mentioned as persons whose property was seized.

Zarrab testified in New York federal court in November that Turkey’s then-prime minister and current president, Recep Tayyip Erdoğan, personally authorized the involvement of Turkish banks in a scheme to evade US sanctions on Iran, Reuters reported.

Zarrab also said that Turkey’s Ziraat Bank and Vakıf Bank were involved in the scheme and that former Deputy Prime Minister Ali Babacan signed off with Erdoğan on the operation.

Zarrab cooperated with US prosecutors in the trial of Mehmet Hakan Atilla, an executive of Turkey’s state-owned Halkbank accused of helping launder money for Iran.

Zarrab told jurors that he ran an international money laundering scheme to help Iran evade US sanctions and spend its oil and gas revenues abroad. He said he helped Iran use funds deposited at Halkbank to buy gold, which was smuggled to Dubai and sold for cash.

US prosecutors charged nine people in the case, although only Zarrab and Atilla were arrested by US authorities. Prosecutors said the defendants were part of a scheme from 2010 to 2015 that involved gold trades and fake purchases of food to give Iran access to international markets, violating US sanctions.

Gold trader Zarrab said Atilla helped devise the transactions along with Halkbank’s former general manager, Süleyman Aslan, and that he paid bribes of more than 50 million euros plus $7 million to Mehmet Zafer Cağlayan, Turkey’s economy minister at the time, to further the scheme, as well as to Aslan. He also said Cağlayan asked for 50 percent of the profits generated by the scheme, which was being run through state-owned Halkbank.

The Turkish government said that Cağlayan acted within Turkish and international law, and Halkbank claims all its transactions complied with national and international regulations.

Zarrab was the prime suspect in a major corruption investigation in Turkey that became public in December 2013 and implicated the inner circle of the ruling Justice and Development Party (AKP) government and then-Prime Minister Erdoğan. Zarrab was alleged to have paid Cabinet-level officials and bank officers bribes to facilitate transactions benefiting Iran.

After Erdoğan cast the case as a coup attempt to overthrow his government orchestrated by his political enemies, several prosecutors were removed from the case, police were reassigned and the investigation against Zarrab was dropped in Turkey.

Hüseyin Korkmaz, a former İstanbul police officer who was arrested by the Erdoğan government in the aftermath of the corruption operations in late 2013 and released in 2015, told the New York court in December that the investigation initially focused on the organization run by gold trader Zarrab but later grew to include dozens of others.

He called Erdoğan the “No. 1” target in a group that also included Cağlayan and Aslan.

Following Korkmaz’s testimony, detention warrants were issued for his mother, father, wife, two sisters, brother and lawyer in Turkey.

Police notes of the Dec. 17, 2013 operations show that Zarrab personally spoke with Erdoğan on April 13, 2013 and asked for an official police guard. Erdoğan and his Cabinet approved it immediately.

A phone call and a video in the Dec. 17 file show that Zarrab in July 2013 sent an unspecified amount of money to the Service for Youth and Education Foundation of Turkey (TÜRGEV), run by Bilal Erdoğan, Erdoğan’s son.

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