Judge to consider US deal ending Halkbank prosecution

U.S. District Judge Richard Berman had initially paused the case for 90 days, allowing Halkbank to demonstrate adherence to the agreement's conditions. These included preventing transactions that benefit Iran and submitting to oversight by a monitor, Ernst & Young, to review the bank's sanctions and anti-money laundering compliance. Upon the expiration of this period on June 10, prosecutors from the Manhattan U.S. Attorney's office requested the formal dismissal of the case, noting that the monitor had found no instances of noncompliance.

Legal analysts suggest that U.S. judges typically have limited discretion to reject deferred prosecution agreements like the one proposed. The agreement does not involve any financial penalties for Halkbank, nor does the bank admit to criminal wrongdoing. During a March hearing, Judge Berman acknowledged a letter from an advocacy group questioning the absence of a financial penalty but did not pursue the matter.

Prosecutors had alleged that Halkbank facilitated secret transfers of $20 billion in restricted funds, converted oil revenues into gold and cash for Iranian interests, and documented fictitious food shipments to legitimize the proceeds from oil sales. Halkbank had previously pleaded not guilty to the charges. Turkish President Tayyip Erdogan had characterized the case as unlawful and "ugly."

Relations between the U.S. and Turkey have improved significantly since President Donald Trump's return to the presidency. Following a meeting with Trump last year, Erdogan expressed optimism about resolving the Halkbank issue. In October, Erdogan stated that Trump had informed him that the "Halkbank problem is finished for us." The settlement was announced after the commencement of the Iran war in February, with the Justice Department asserting that dropping the prosecution would serve U.S. interests in curbing support for Iran.