Why is Washington going soft on the Turkish banks enabling Iran’s terrorism?

The Turkish state-owned lender Halkbank has served as a conduit for illicit Iranian financing networks. It was indicted in the U.S. in 2019 for one of the largest sanctions-evasion schemes in modern history, and at least two of its employees were convicted during the first Trump administration for their involvement.

Yet despite overwhelming evidence that the bank helped Iran bypass U.S. sanctions, the White House has now granted Ankara a lenient settlement that lets the bank itself avoid prosecution. This outcome — now all but a done deal and requiring only a judge’s signature — undermines both sanctions enforcement and American credibility.

Between 2012 and 2013, Halkbank played a pivotal role in converting Iranian oil revenues trapped in Turkish accounts into Turkish lira, then gold and ultimately cash, which was in turn smuggled back to Iran.

The operation — engineered by Reza Zarrab, an Iranian Turkish businessman and Mehmet Hakan Atilla, Halkbank’s deputy general manager — allowed Iran to circumvent Washington’s “maximum pressure” campaign. Zarrab’s testimony in 2017 revealed the complicity of senior Turkish officials, some of them within President Recep Tayyip Erdogan’s inner circle.

Halkbank’s actions violated multiple U.S. laws, including the International Emergency Economic Powers Act and anti-money laundering statutes. Yet successive administrations, Republican and Democratic alike, have refrained from pursuing the maximum penalties.

The Trump administration has now reached a deferred prosecution agreement between the U.S. and Halkbank — an extraordinary concession compared to the multibillion-dollar penalties paid by European banks such as BNP Paribas ($8.9 billion) and Standard Chartered (over $1........

© The Hill