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NEW YORK (AP) — A federal prosecutor said Monday that politically connected lawyers are using inaccuracies to whitewash charges against a prominent Turkish businessman as they try to get Turkey's president and U.S. officials to resolve the case diplomatically.
Assistant U.S. Attorney Dennis Lockard said Reza Zarrab is charged with a "serious national security offense" despite efforts by former Republican New York Mayor Rudolph Giuliani and former U.S. Attorney General Michael Mukasey to minimize his involvement in a multiyear conspiracy to allow the government of Iran and other entities to access U.S. financial institutions.
Zarrab has pleaded not guilty to conspiring to process hundreds of millions of dollars' worth of financial transactions for Iranian businesses or Iran's government. Authorities say those transactions are banned by U.S. and international sanctions.
Lockard criticized Giuliani and Mukasey — both members of Zarrab's legal team — during a pretrial hearing before U.S. District Judge Richard M. Berman in Manhattan. He said separate affidavits filed by Giuliani and Mukasey to explain their roles in the case mischaracterized the alleged crimes as not serious or harmful to the United States because no transactions involved weapons, nuclear technology or other contraband.
"The entities that benefited from this alleged scheme include the Islamic Revolutionary Guard Corps and agents or affiliates of that entity, Iranian banks that have been sanctioned for their role in providing financing for Iran's nuclear programs, and Iranian commercial airlines," he said.
He said prosecutors would prove Zarrab and coconspirators worked with high-level government and banking officials in Iran and Turkey after offering those services to Iran in a letter personally addressed to then-Iranian President Mahmoud Ahmadinejad.
"Zarrab funneled tens of millions of dollars to high-level government and bank officials to facilitate and protect this scheme," Lockard said.
He also said Giuliani and Mukasey tried to "muddy the waters" by suggesting in their affidavits that the government had leaked through publicly filed court documents the fact that Giuliani and Mukasey had joined the case.
Lockard said it was not a confidential conversation when Zarrab's lawyers notified prosecutors earlier this year that Giuliani and Mukasey planned to speak with Turkey's president.
He said it was necessary for prosecutors to reveal the meeting as they asked the judge to conduct a hearing to ensure that Zarrab was aware that law firms employing Giuliani and Mukasey had represented banks in the case and that he understood there could be a conflict of interest. Giuliani's firm also has represented the government of Turkey.
Zarrab's criminal lawyer, Ben Brafman, declined to comment Monday after telling the judge he didn't "want my silence to suggest that I agree with what Mr. Lockard just said."
Zarrab, 33, of Istanbul, has been in custody since his March 2016 arrest as he arrived with his family in Florida for vacation. He is a well-known personality in Turkey partly because he's married to Turkish pop star and TV personality Ebru Gundes.
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