Turkish Government-Owned Bank Argues for End of Iran Sanctions Violations Case
A lawyer for Turkish government-owned bank Halkbank made the case to the U.S. Court of Appeals for the 2nd Circuit that it is immune from prosecution due to protections under the Foreign Sovereign Immunity Act, in an April 12 oral argument. Simon Latcovich of Williams & Connolly asserted that the government had no jurisdiction over the bank since the bank is owned by the Turkish government and that the FSIA does not extend jurisdiction over sovereign states for criminal cases. Latcovich also claimed that even if the FSIA allowed for this jurisdiction, Halkbank would still be exempt from prosecution under common law. His argument follows that if the courts were to find that immunity for sovereign states was not extended to criminal cases under the FSIA, this would erode the congressional mandate of the act without a word from the body itself.
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In October 2019, Halkbank was charged with fraud, money laundering and conspiracy to violate the International Emergency Economic Powers Act after working with Iran to evade U.S. sanctions (see 1910160015). The case was brought by the Department of Justice to the U.S. District Court for the Southern District of New York, where a federal judge allowed the prosecution to proceed. Judge Richard Berman permitted the case, finding that the FSIA did not in fact extend to criminal cases and that if it did, there were commercial activity exemptions in the act allowing for prosecution of this case.
U.S. prosecutor Sidhardha Kamaraju attempted to carry the mantle for Berman's findings, declaring that the FSIA applies only to civil cases. “There is nothing in the statute that supports such a dramatic extension of sovereign immunity,” he declared. Kamaraju attempted to refute Halkbank's argument based on the statutory language of the act which, as Kamaraju argued, only speaks in civil terms.