NEW YORK, March 9 (Reuters) - Turkish state-run lender Halkbank and the U.S. Justice Department have reached a deferred prosecution agreement, the judge overseeing the long-running U.S. criminal case against the bank said in a court filing on Monday, without providing further details of the deal.
In the case, prosecutors had accused of fraud, money laundering and conspiracy for allegedly helping Iran evade American economic sanctions.
Halkbank's case has long been a thorn in U.S.-Turkey relations,
with Turkish President Tayyip Erdogan calling it an "unlawful, ugly" step.
The agreement was announced after the U.S. Supreme Court in October 2025 let stand a federal appeals court decision that let the prosecution proceed.
U.S. prosecutors originally charged Halkbank in 2019, during President Donald Trump's first White House term.
Erdogan met with Trump in September, and expressed hope the following month that the meeting would resolve various issues between the countries.
The Turkish president said Trump told him at the White House and in a subsequent phone call that "the Halkbank problem is finished for us."
SEVERAL RELATED CRIMINAL CASES
Halkbank was accused of using money servicers and front companies in Iran, Turkey and the United Arab Emirates in its sanctions-evasion scheme.
U.S. prosecutors said the bank secretly transferred $20 billion of restricted funds, converted oil revenue into gold and cash to benefit Iranian interests and documented fake food shipments to justify transfers of oil proceeds.
Halkbank pleaded not guilty to bank fraud, money laundering and conspiracy charges.
The case was an outgrowth of several related criminal cases, including against Turkish-Iranian gold trader Reza Zarrab and former Halkbank executive Mehmet Hakan Atilla.
Zarrab pleaded guilty to bank fraud, money laundering and conspiracy charges in 2017, but has not been sentenced.
He testified against Atilla, who was convicted in 2018 of bank fraud and conspiracy charges. Atilla returned to Turkey in 2019 after serving most of a 32-month prison term. He has denied wrongdoing.
TREK THROUGH U.S. COURTS
Halkbank's case has taken a circuitous path through the U.S. courts.
Berman originally ruled in 2020 that Halkbank did not deserve immunity from prosecution.
The following year, the 2nd U.S. Circuit Court of Appeals in Manhattan upheld that ruling but on different grounds. It said Halkbank could be prosecuted under the federal Foreign Sovereign Immunities Act of 1976, because its alleged misconduct involved commercial activity not covered by that law.
In 2023, the U.S. Supreme Court temporarily voided the prosecution, despite agreeing that Congress' desire to shield foreign countries and their instrumentalities from civil liability did not cover criminal cases. Instead, it ordered the 2nd Circuit to more thoroughly review whether immunity under centuries-old common law shielded Halkbank.
The appeals court found no such shield in October 2024, prompting Halkbank's second Supreme Court appeal. The Trump administration argued that the common law does not shield foreign state-owned companies from criminal prosecution.
(Reporting by Jonathan Stempel and Luc Cohen in New York)
