OFAC amends Iran Sanctions Regs & delists 2 from Global Magnitsky sanctions

US Treasury BuildingIran:

Today, OFAC issued an amendment to the Iranian Transactions and Sanctions Regulations, in order to take additional regulatory steps to implement the US decision to cease participation in the JCPOA. The amendment will take effect upon publication in the Federal Register on 5 November 2018. Further OFAC guidance will also be issued on that day relating to the full re-imposition of US Iran sanctions. See OFAC Notice.

Global Magnitsky:

In a separate action today, OFAC removed Turkey’s Minister of Justice, Abdulhamit Gul, and Minister of Interior, Suleyman Soylu, from the US Global Magnitsky sanctions list (US asset freezes and travel bans lifted). Both were listed in August 2018, pursuant to Executive Order 13818 (Global Magnitsky), over the arrest and detention of US Pastor Andrew Brunson (previous blog), who has since been released and returned to the United States. See OFAC Notice.

Turkey responds to US measures

Turkey-US2.jpgWe reported last week that the US had added Turkey’s Minister of Justice Abdulhamit Gul and Minister of Interior Suleyman Soylu to its Global Magnitsky sanctions list (Executive Order 13818) over the “leading roles” they played in the arrest and detention of US Pastor Andrew Brunson.

In response, Turkey’s President Recep Tayyip Erdogan announced on 4 August that he would instruct his officials to freeze any Turkish assets of US Attorney General Jeff Sessions and Interior Secretary Ryan Zinke. Secretary Zinke is responsible for managing the US’s natural resources and cultural heritage.

OFAC adds 2 Turkish Ministers to Magnitsky sanctions list over detention of US pastor Brunson

Turkey-USA BreakupYesterday, OFAC added Turkey’s Minister of Justice Abdulhamit Gul and Minister of Interior Suleyman Soylu to its Global Magnitsky sanctions list (Executive Order 13818), on the basis that they played “leading roles in the organizations responsible for the arrest and detention of Pastor Andrew Brunson”. As a result, both individuals are now subject to US asset freezes and travel bans. See OFAC Notice and Treasury press release.

Last week, President Donald Trump tweeted that the US would impose “large sanctions on Turkey for their long time detainment of Pastor Andrew Brunson” (previous blog).

Germany drops sanctions on Turkey, USA threatens Turkey sanctions for detention of US pastor

Turkey flag.jpgGermany has lifted its economic sanctions on Turkey after Ankara ended its two-year state of emergency. Its sanctions consisted of a €1.5 billion ($1.7 billion) limit on export guarantees to Turkey imposed in July 2017 after the detention of a German human rights campaigner and five other activists, including the head of Amnesty International in Turkey.

Meanwhile last week (26 July), US President Donald Trump tweeted that the US will impose “large sanctions on Turkey for their long time detainment of Pastor Andrew Brunson”. Andrew Brunson, an evangelical minister, has been detained on charges of involvement in a failed 2016 coup in Turkey. He has recently been moved to house arrest. In response, Turkey’s Ministry of Foreign Affairs issued a press release stating that “[n]o one can give orders to Turkey and threaten our country. The rhetoric of threat against Turkey is unacceptable. … As regards the Brunson case, necessary information has been provided to our U.S. counterparts on various occasions and it has been clearly expressed that this issue is totally within the competence of the independent Turkish judiciary.”

On 26 July, the US Senate Foreign Relations Committee approved a Bill committing the US to opposing any international credit offers to Turkey. The Bill will now move to the full chamber of the Senate. A similar Bill was also introduced in the US House of Representatives.

US to impose CAATSA sanctions on Turkey over purchase of Russian missiles

Turkey-USA Breakup.jpgUS Assistant Secretary of State Wess Mitchell has informed a Foreign Relations Subcommittee that sanctions, pursuant to section 231 of the Countering America’s Adversaries Through Sanctions Act (CAATSA), will be imposed on Turkey for its purchase of S-400 missile systems from Russia.

Section 231 of CAATSA authorises the US President to impose a number of sanctions on those determined to have engaged in a “significant transaction” with the “defense or intelligence sectors of the [Russian Government]”. In late October 2017, the US issued guidance under section 231(d) of CAATSA, naming 39 Russian entities that fit into that category of being part of, or operating for or on behalf of, the defence and intelligence sectors of the Russian Government. The guidance itself did not impose sanctions on the specified entities (see previous blog).

Turkish banker sentenced to 32 months for US Iran sanctions evasion

Halkbank.jpgOn 3 January 2018, Turkish banker Mehmet Hakan Atilla was found guilty of conspiracy to violate US sanctions against Iran. The scheme consisted of a money-laundering network facilitated by Turkish state bank Halkbank, which allowed Iran to gain access to international markets in contravention of US sanctions. Although nine defendants had been charged in the case, Mr Atilla was the only one that stood trial. Co-defendant Reza Zarrab, a Turkish-Iranian businessman, previously pleaded guilty and gave evidence in the trial against Mr Atilla (previous blog).

Yesterday (16 May 2018), the trial judge – District Judge Richard Berman – sentenced Mr Atilla to 32 months in prison. He held that the Halkbank executive appeared to have been following orders from the bank’s CEO, Suleyman Aslan, who is one of the seven defendants at large. He found that Mr Atilla was less culpable than his co-defendant Reza Zarrab, who has yet to be sentenced.  The criminal prosecutions against Mr Atilla and his co-defendants are separate from any penalty that may be imposed on Halkbank, which is expected to face a fine from OFAC.

Turkish banker’s motion to be acquitted of US-Iran sanctions evasion dismissed

HalkbankWe previously reported that Mehmet Hakan Atilla, an executive at Turkey’s majority state-owned Halkbank, had been found guilty in a New York Court of conspiracy to violate US sanctions against Iran.

Yesterday, the judge in the trial – US District Judge Richard Berman – dismissed Mr. Atilla’s motion for judgment of acquittal under Fed. R. Crim. P. 29(a) (that motion was made at the close of the US Government’s case, however, the court had informed the parties of its intention to elect not to resolve the motion until the close of all the evidence). In dismissing the motion, the judge held that the evidence presented against Mr. Atilla had been “clearly sufficient” to support the jury’s verdict.

Mr. Atilla is scheduled to be sentenced on 11 April 2018.

Full resumption of visas between US and Turkey

Turkey-US2On 28 December 2017, the US Department of State announced the full resumption of visa services in Turkey following “high-level assurances” having been adhered to by the Turkish Government.

On the same day, the Turkish Embassy in Washington DC issued a statement welcoming the decision of the US and simultaneously lifted its visa restrictions on American citizens. The statement also declares that the Turkish Government gave no such assurances, and that it was “inappropriate [of the US] to misinform [the] Turkish and American public that such assurances [had been] provided”.

We previously reported on the initial visa suspensions between the two states in October (see here), as well as the limited resumption of visas which followed in November (see here).