Tom Fox: ‘What’s nationalist about corruption?’
Wednesday, November 29, 2017 at 7:08AM
Thomas Fox in Mehmet Hakan Atilla, Turkey

Mehmet Hakan AtillaThat question was posed in a New York Times story about the start of the trial of Mehmet Hakan Atilla, which began Monday in New York City with jury selection. The case involves allegations money-laundering, corruption and evasion of Iranian sanctions by several Turkish individuals, government officials and banks in the country.

The case has drawn the ire of the Turkish government which has gone so far as to open an investigation into the former head of the Justice Department for the Southern District of New York, Preet Bharara, whose office originally brought the charges.

The case involves Reza Zarrab, who is accused of managing a billion-dollar scheme to smuggle gold for Iranian oil. Zarrab may have entered into a plea bargain with the prosecution and may reveal damaging evidence about corruption and illegal dealings in high places in Turkey right up to the Turkish Foreign Minister.

The Times reported that “If Mr. Zarrab has indeed become a government witness, prosecutors are still expected to proceed to trial against a co-defendant, Mehmet Hakan Atilla, a Turkish banker who has pleaded not guilty. Seven other defendants have been charged but remain at large.”

Turkish officials are concerned about the untoward information which could come out of the trial, linking the highest level of its government to trade with Iran during the period of U.S. sanctions. All of this is in the context of the lowest ebb of relations between Turkey and the U.S. probably since they were on opposite sides during World War I.

Turkey’s President has claimed this trial is an attack on the very foundation of his government. This led to the question raised by Kemal Kilicdaroglu, leader of the Republican People’s Party, an opposition politician, “What’s nationalist about corruption?”

On a more practical note, business leaders in Turkey are concerned the trial could negatively impact the reputation of the country, particularly around bribery and corruption. The Turkish lira continues to drop against the U.S. dollar and the tensions between the countries are not helping business relations either.  

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Tom Fox is a Contributing Editor of the FCPA Blog. He has practiced law in Houston for 30 years. He's the creator of the award winning FCPA Compliance and Ethics website. He is the Compliance Evangelist.  His best-selling seminal book, "Best Practices Under the FCPA and Bribery Act: How to Create a First Class Compliance Program” (available from Amazon here) is widely viewed as one of the top volumes on the nuts and bolts of compliance. His latest book is 2016 – The Year in Corporate FCPA Enforcement.

Article originally appeared on The FCPA Blog (https://www.fcpablog.com/).
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