- A Turkish-Iranian gold trader accused of violating US sanctions on Iran flipped against his codefendant on Tuesday and will cooperate with federal prosecutors.
- The plea deal could spell trouble for former national security adviser Michael Flynn, who was reportedly offered $US15 million to pursue Turkish government interests in the US.
- The trader, Reza Zarrab, could have information about Flynn’s ties to Turkish President Recep Erdogan that could be useful to federal investigators examining the extent to which Flynn was working for the Turkish government both before and after the election.
A Turkish-Iranian gold trader accused of violating US sanctions on Iran pleaded guilty on Tuesday, prompting speculation that he could be cooperating with prosecutors building a case against Michael Flynn, the former national security adviser whose lobbying work for Turkish government interests is under federal investigation.
The trader, Reza Zarrab, was arrested in March 2016 in Florida. His case was set to go to trial in New York this week on charges of fraud and money laundering, but he took a plea deal that will require him to testify against his codefendant in the same conspiracy, a defence lawyer said on Tuesday.
Former US attorney Preet Bharara wrote a memo last May alleging that Zarrab “facilitated millions of dollars-worth of transactions on behalf of Iran … through a global network of companies located in Turkey and the United Arab Emirates ” designed to evade US sanctions.
Bharara also accused Zarrab of wrongdoing that implicated top Turkish government officials. Zarrab, he alleged, had “engaged in a massive bribery scheme … paying cabinet-level [Turkish] governmental officials and high-level bank officers tens of millions of Euro and US dollars” to facilitate his transactions.
Turkish President Recep Tayyip Erdogan fiercely lobbied high-level Obama administration officials for Zarrab’s release, beginning shortly after Zarrab was arrested in Miami last March. Erdogan made personal appeals to both Vice President Joe Biden and President Barack Obama, and he sent his justice minister at the time to meet with then-Attorney General Loretta Lynch to argue that the case was “based on no evidence.”
Zarrab was not released, but Erdogan apparently continued lobbying for his release into January. By the time Obama left office, the Turkish government had already begun establishing ties to people close to President Donald Trump, including Flynn and former New York City Mayor Rudy Giuliani.
Giuliani joined Zarrab’s legal team in March, shortly after Flynn was fired over his conversations with Russia’s former ambassador to the US, Sergei Kislyak.
Federal prosecutors are now pursuing a separate but parallel investigation into whether Flynn used his cabinet position to secure Zarrab’s release from a New York jail and return to Turkey a controversial Muslim cleric loathed by Erdogan – in exchange for as much as $US15 million.
Zarrab could have information about Flynn’s ties to Erdogan that could be useful to federal investigators examining the extent to which Flynn was working for the Turkish government both before and after the election.
“You can fill in the gaps that federal investigators are looking for any relation between Erdogan and Flynn,” criminal defence attorney Danny Cevallos told NBC last week. “So, to the extent that Zarrab has any connection or knowledge of that, it is very important that they’re flipping him.”
Special counsel Robert Mueller has reportedly compiled enough evidence to bring charges against Flynn and his son, Michael Flynn Jr., related to his lobbying work throughout the latter half of 2016 – while he was a top Trump campaign surrogate – for a businessman with ties to the Turkish government. Flynn did not register with the US Justice Department as a foreign agent until March 2017.
Mueller’s mandate gives him permission to investigate “any matters” that arise out of his investigation into Russia’s election interference and whether the Trump campaign colluded with Moscow.
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