Leak confirms U.S. pressure on Turkey regarding Iranian banks

David Cohen, the U.S. Treasury assistant secretary for terrorist financing and financial crimes, warned Turkish officials and private bank executives about doing business with Iranian banks, according to a leaked cable from the U.S. Embassy in Ankara.

Cohen’s Oct. 19-20, 2009, visit to Ankara was reported in the Turkish media as an attempt to put pressure on Turkey regarding Iranian banks. The recently revealed cable, signed by former U.S. Ambassador James Jeffrey, appears to confirm the media stories.

“[Turkish government] officials insisted they will comply with all U.N. Security Council obligations, but are unwilling unilaterally to sever trade with their neighbor Iran,” Jeffrey said in the cable.

According to the leaked document, Finance Minister Mehmet Şimşek told U.S. officials that Turkish financial institutions would “continue to apply extreme due diligence and special vigilance when dealing with Iran,” but that Turkey had “the geographic reality of a long border and trading history with Iran.”

Meeting with Halkbank

Cohen also met with an official from state-owned Halkbank, whose name was deleted in the document. The official told Cohen that the bank could close a correspondent account with Iran’s Bank Sepah.

“He noted that Halkbank has a representative office in Tehran, left over from its 2004 merger with Pamukbank,” the document said. “He noted that after the 2004 merger, Halkbank ended its correspondent banking relationship, but not its business development, maintaining a representative in Tehran. He acknowledged Halkbank has a long-inactive correspondent account with Bank Sepah, which it can close.”

Cohen also met with representatives of the Banking Regulation and Supervision Agency, or BRSA, who pledged to pass information on “illicit Iranian activities” to the BRSA's Enforcement Division and reply with any information that they found.

“Regarding the activities of Bank Mellat, BRSA officials noted that the bank has a negligible share of the banking sector,” the document said. “Mellat conducts mainly trade transactions through its Turkish branches, and the bank is audited four times per year by external auditors.”

Trade must be financed on an ongoing basis, Şimşek had said, insisting that the United States must keep this in mind.

“In response to downgraded intelligence information on Iranian misuse of the Turkish financial system that Cohen passed, Şimşek noted Turkey wants all its neighbors to be free of nuclear weapons,” the document said. “Şimşek pledged to instruct Turkish financial institutions to increase vigilance against Iranians who might use deceptive methods to circumvent international sanctions.”


/Hurriyet Daily News/