On May 5, 2025, Turkey’s state-owned Halkbank filed a petition with the U.S. Supreme Court to challenge a lower court ruling that permits its prosecution for allegedly helping Iran evade American sanctions. The appeal follows the October 22, 2024, decision by the 2nd U.S. Circuit Court of Appeals in Manhattan, which allowed the case to proceed. Halkbank’s U.S.-based lawyer, Robert Cary, confirmed the filing, though the petition was not immediately available on the Supreme Court’s website.

The case, initiated in 2019, centers on allegations that Halkbank engaged in fraud, money laundering, and conspiracy by using money servicers and front companies in Iran, Turkey, and the United Arab Emirates. Prosecutors assert that the bank facilitated the secret transfer of $20 billion in restricted Iranian funds, converted oil revenue into gold and cash to benefit Iranian interests, and documented fictitious food shipments to justify the transfers.

This legal battle has strained U.S.-Turkey relations, with Turkish President Tayy … denouncing the prosecution as an “unlawful, … . Despite these tensions, President Erdogan and U.S. President … reported having a productive phone call on the same day the petition was filed, indicating potential diplomatic engagement.

The Supreme Court previously addressed the case in 2023, ruling that the Foreign Sovereign Immunities Act does not provide criminal immunity to foreign states or their instrumentalities. However, it remanded the case to the appeals court to consider whether common law immunity could apply. The 2nd Circuit subsequently determined that Halkbank’s activities were essentially commercial, allowing the prosecution to proceed.

Halkbank’s appeal to the Supreme Court marks its second attempt to seek relief from the highest U.S. court. The outcome of this case could have significant implications for international banking operations and the enforcement of U.S. sanctions laws.

Source: Reuters