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By John Helmer, Moscow

Victoria Nuland (lead image, right), the US official in charge of regime change in Russia, Ukraine, and Europe, has repeated her tactics, this time to put pressure on the President of Turkey, Recep Tayyip Erdogan (left).

The opening of a secret US indictment on March 21, after years of inaction, followed the arrest in Florida of Reza Zarrab on March 19. The moves have been interpreted by officials in Moscow, Nicosia and Ankara as a carbon-copy of the law enforcement scheme applied against Ukrainian oligarch Dmitry Firtash following the putsch in Kiev which ousted Firtash’s ally, President Victor Yanukovich, in February 2014. US litigation to threaten Cyprus President Nicos Anastasiades has also been attempted by Nuland for several months.

The arrest of Zarrab in the US, comments a Russian political analyst, Andrei Manoilo, is more pinch than putsch. “It is not so much an attempt by Washington to remove Erdogan through squeezing Zarrab for secret information about the financial relationships Erdogan has had with Iran; as it reflects the desire to put Erdogan on a new leash, and make him better controllable and dependent on the will of the United States.”

Nuland is the Assistant Secretary of State for European and Eurasian Affairs. Her territory of operations covers western and eastern Europe, Russia, and Turkey. Evidence of her involvement in the overthrow of Yanukovich in Kiev, and the subsequent indictment, arrest and extradition application for Firtash was assessed by a Vienna court as a political intervention, with trumped-up charges. Firtash was released; details can be followed here.

The escalation of Nuland’s pressure against Cyprus, in favour of the Turkish regime in Ankara, was reported last week.

Zarrab has been under investigation by the Justice Department, Federal Bureau of Investigation, and US intelligence agencies for years. Alleged against him are violations of the US sanctions against Iran, which were first introduced in 1979. The highest of the UK and European courts have subsequently ruled the evidence for the sanctions to be lacking, and the sanctions themselves, when applied by the UK and European Union to Bank Mellat, a state-owned Iranian bank, to be illegal. The US Government announced it was dropping its Iran sanctions on January 16. That was two months before the indictment for sanctions violations was activated against Zarrab. He and his companies had not been named on US sanctions lists before; Bank Mellat had been listed since 2007.

On March 21, according to the US Justice Department, “between 2010 and 2015, Zarrab, Jamshidy [Kamelia Jamshidy, an employee of Zarrab] and Najafzadeh [Hossein Najafzadeh, a senior executive of Bank Mellat] conspired to conduct international financial transactions on behalf of and for the benefit of, among others, Iranian businesses, the Iranian government and entities owned or controlled by the Iranian government. Among the beneficiaries of these schemes were Bank Mellat, an Iranian government-owned bank designated, during the time of the charged offenses.”

Zarrab (below, left), 32, born in Tabriz, holds Iranian, Turkish and Azerbaijani nationality. The Justice Department press releases after his arrest headlined him as a “Turkish national”. He is married to Ebru Gündeş (right), a Turkish pop-singer and television star.


The two co-defendants in the indictment have not been arrested; they are Iranian nationals.

Zarrab’s scheme, according to the Justice Department, “was part of an intentional effort to assist the government of Iran in evading the effects of United States and international economic sanctions…. Zarrab, Jamshidy, Najafzadeh and their co-conspirators used an international network of companies located in Iran, Turkey and elsewhere to conceal from U.S. banks, OFAC [Office of Foreign Assets Control of the US Treasury] and others that the transactions were on behalf of and for the benefit of Iranian entities. This network of companies includes Royal Holding A.S., a holding company in Turkey; Durak Doviz Exchange, a money services business in Turkey; Al Nafees Exchange, a money services business; Royal Emerald Investments; Asi Kiymetli Madenler Turizm Otom, a company located in Turkey; ECB Kuyumculuk Ic Vedis Sanayi Ticaret Limited Sirketi, a company located in Turkey; and Gunes General Trading LLC; and others. As a result of this scheme, the co-conspirators induced U.S. banks to unknowingly process international financial transactions in violation of the IEEPA [International Emergency Economic Powers Act].”

The US charges were timed just before Erdogan flew to Washington for meetings with government officials last week. Erdogan reacted, telling the Turkish press the Zarrab case “doesn’t concern Turkey.” He counter-charged the US government with shielding his political opponents living in the US. “The real money launderers are in Pennsylvania,” Erdogan claimed. The pro-Erdogan press in Turkey called the US move “strategic animosity” towards Erdogan, and the prelude to a “coup attempt.”

1791_2A Turkish analysis of the US move claims it “sits at the nexus of Turkey-Iran-US relations — with potential implications for all sides. While much focus is on how his detention may be bad news for Turkish President Recep Tayyip Erdogan and the ruling Justice and Development Party (AKP), the real story is that this is much more good news for Iranian President Hassan Rouhani.” Enis Aydin, a reporter for the Turkish edition of CNN, said Zarrab’s arrest could provide evidence for President Rouhani (right), to attack “the shady web, led and incited by the administration of former President Mahmoud Ahmadinejad and its affiliates in the Islamic Revolutionary Guard Corps (IRGC).”

An Iranian business source close to senior officials in Tehran says Zarrab “is widely known as a lobbyist for the Turkish government. He was used heavily during the Ahmadinejad adminstration and is rumoured to have moved between $18 and $30 billion worth of gold. His marriage to a famous Turkish singer has helped him to better integrate into the Turkish elite. For the past 30 months, his importance from the operations point of view of the Iranian Government has vanished. But his knowledge about the Turkish part of the anti-sanctions operation is still valuable. I think his arrest has more to do with undermining the Turkish government and less to do with Iran, but nevertheless, it does impact both the governments. “

In Tehran there has been no reporting of Nuland’s role in the affair. At the State Department, Nuland is not directly responsible for Iran; that job is held by the Assistant Secretary for Near Eastern affairs, Anne Patterson. “Nuland has not been mentioned in the Iranian press much,” said the Tehran source. “Specifically about the Zarrab case there is no direct link between him and Nuland in the local media. Nuland’s intention could hurt Turkish government more than Iran.”

The text of the 20-page indictment can be read in full here. The main allegation against Zarrab is that he carried out transactions “to defraud the United States”. In a letter of Zarrab’s, cited as evidence in support of the US case and dated December 2011, he says “the Zarrab family, which has had a half a century of experience in foreign exchange, . . . considers it to be our national and moral duty to declare our willingness to participate in any kind of cooperation in order to implement monetary and foreign exchange anti-sanction policies.”

The earliest evidence identified is from January 2011; additional email evidence is cited until November 2013. Several sources for the emails and other evidence to substantiate the US charges appear to be witnesses promised immunity. Six of them are reported as “a co-conspirator not named as a defendant herein.” None appears to be an American national. None was on US territory when the alleged offences were committed. The indictment appears to have been presented to a grand jury between the end of 2013 and early in 2015. Unlike comparable indictments, all trace of the date of the grand jury proceeding and the issue of the Zarrab indictment has been blacked out or removed. A code number, 15 CRIM 867, stamped on the header of the indictment, indicates that the unsealed charge sheet is at least a year old.

The indictment acknowledges that the offence was “begun and committed outside the jurisdiction of any particular State or district of the United States”. For timing, the indictment says “from at least in or about 2010, up to and including in or about 2015”. The clumsiness of the expression suggests to US lawyers that it was added after the decision was made by US officials, outside the prosecutors’ office in New York, to reactivate the old indictment, and arrest Zarrab. “This has been made to appear more recent than it was,” suggests a US legal expert.

1791_3Zarrab was arrested in Florida, but he is being prosecuted by Preet Bharara (right), the District Attorney for Manhattan, and tried in New York. The cash movements and transactions identified in evidence run between Iran, Turkey, Canada, Hong Kong, China and Turkmenistan. No US individual or company has been identified as suffering any harm. The only US involvement was the processing of the dollar transfers by US clearing banks in New York. Zarrab and his associates are accused of acts to “export, reexport, sell, and supply, and cause to be exported, reexported, sold, and supplied, directly and indirectly, from the United States, services, to wit, international financial transactions to Iran and to the government of Iran.”

The US banks which took fees for these transactions have not been named, nor ordered to surrender their profit. Zarrab and his associates are subject, according to the indictment, to forfeiture of whatever property or money the US can find, “representing the amount of proceeds obtained as a result of the offenses.” The prosecutors have identified three large sums transferred — €100 million, $30 million, and €3,711,365 – without making clear that Zarrab either ordered them or benefitted from them. The transactions allegedly associated with Zarrab total $2,653,332 over three years. The indictment fails to estimate how much money Zarrab may have earned for himself.

A US lawyer who specializes on racketeering cases involving foreigners transferring dollars through US clearing banks says it’s rare in civil litigation for the US courts to accept jurisdiction unless there is much stronger US involvement than the processing of funds by the clearing banks in New York. In Nuland’s operation against Firtash, the evidence of US jurisdiction involved several US companies including Boeing, meetings in several US cities, and US citizens.

US and Russian observers believe Zarrab’s arrest was decided by Nuland, possibly over objections from Justice Department lawyers that the jurisdiction of US courts over Zarrab is weak; and retrospective prosecution for fund transfers which are no longer sanctioned might trigger retaliation against US businessmen in Turkey or Iran.

Stanislav Ivanov, an analyst at the Centre for International Security in Moscow, cautions against “excessively politicizing the arrest. There should be no expectation that he will provide sensational revelations in relation to the Turkish authorities. For Washington, Erdogan remains a strategic ally in the Middle East, an outpost on the southern flank of NATO. There can be differences over some issues between Washington and Ankara, just as there are between Moscow and Minsk, but they do not change the general picture. It’s incorrect to suspect US attempts to get rid of Erdogan.”

Andrei Manoilo, a professor of political science at Lomonosov Moscow State University, believes “the main task of the US right now is to intimidate Erdogan and make him docile again”. The capture of Zarrab may help “get into [US] hands new pieces of information about [Erdogan’s] secret financial dealings with countries such as Iran, bypassing the sanctions imposed on that country.” But Manoilo, who has written on US methods for regime change, anticipates no putsch.

“Erdogan still needs the US to provoke Russia in Syria. But for that, Erdogan should be obedient and dependent on instructions from Washington. That is the way he was immediately before, and immediately after, the provocation against the Russian bomber, which the Turkish Air Force shot down over Syrian territory. But now he has begun to go out of control, seeing that Russia and the United States have engaged in intensive talks on Syria, entering into agreements in which Turkey does not participate, her voice unheeded.”

How will Russia react? “It’s simple,” responds Manoilo. “Russia is strongly opposed to any US attempts by force or by other means (such as provoking colour revolutions) to change the political regime in Turkey, to displace or remove Erdogan. This is an internal affair of the Turkish Republic. Of course, Russian-Turkish relations are going through hard times, and from the Russian side to Erdogan there are quite specific claims. But even they will not get Russia to change its position on the legitimacy of the [Ankara] regime. Any changes can only happen by internal reforms, not by external intervention, as the United States is like to do.”

When the State Department spokesman was asked what contacts Nuland and her officials may have had with their Turkish counterparts, following Zarrab’s arrest and the release of the indictment, the spokesman replied: “I don’t have any information on that particular report.”


As he spoke in Washington, Deputy Secretary of State Antony Blinken (above, right) was in Ankara with a delegation of US military and intelligence officers to talk to their Turkish counterparts. On March 23 Blinken met Turkish Foreign Minister Mevlut Cavusoglu (left). They focused, according to local press, “on the fight against DAESH, cooperation in counterterrorism activities, Syria and the ongoing Geneva peace talks.” Nuland was absent.

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