Halkbank and US Justice Department deferred prosecution agreement takes effect
Turkish state lender Halkbank announced Wednesday that its deferred prosecution agreement with the US Justice Department has officially taken effect following a hearing at the US District Court for the Southern District of New York. The bank confirmed the agreement is binding on both parties, with no admission of wrongdoing or payment of fines required.
Turkish public lender Halkbank announced Wednesday that the deferred prosecution agreement signed with the US Justice Department has formally taken effect following proceedings at the US District Court for the Southern District of New York. In a statement released through Türkiye's Public Disclosure Platform, the bank confirmed that "the agreement is binding on both the U.S. Department of Justice and the Bank."
Court hearing addresses agreement terms
During Wednesday's court session, US District Judge Richard Berman questioned a Justice Department lawyer about the agreement's terms, expressing concern that Halkbank would pay nothing under the deal, according to Bloomberg. Assistant US Attorney Michael Lockard responded that the court lacked authority to review the terms, arguing the agreement reflects "significant national security and foreign policy interests" within the executive branch's purview. The exchange highlighted the unusual nature of the resolution, which involves no financial penalties.
National security interests cited
US Attorney for the Southern District of New York Jay Clayton had previously written to Judge Berman explaining that the Justice Department "believes the resolution of these charges against Halkbank on the terms and conditions set forth in the Agreement is in the best interests of the United States." Clayton emphasized that "this agreement by Halkbank furthers the United States' compelling interests in combatting terrorist financing and financial support for the government of Iran."
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No admission of wrongdoing or fines
Halkbank reiterated that under the settlement, the bank "will not admit criminal wrongdoing and will not pay judicial or administrative fines." The resolution brings an end to approximately nine years of legal proceedings against the Turkish lender in the United States. The agreement follows the US Supreme Court's October rejection of Halkbank's appeal to review a lower court ruling that the public lender was not immune to prosecution under common law, clearing the path for this negotiated resolution.
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