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Gold trader Reza Zarrab to reveal Turkish corruption 'of global proportions' after plea deal

Reza Zarrab pleaded guilty to money laundering, bank fraud and a bribery conspiracy charge [Getty]

Date of publication: 29 November, 2017

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Turkish-Iranian gold trader Reza Zarrab is expected to lift the lid on a Turkish corruption plot, which helped Iran evade US sanctions, after he agreed to cooperate with federal prosecutors.
A Turkish-Iranian gold trader has agreed a plea deal with prosecutors, who say he will reveal the inside story of a plot to evade US sanctions in Iran "in a scheme so large that it affected the economies of countries in the Middle East".

Reza Zarrab, who is being held by the authorities at an undisclosed location, pleaded guilty on October 26 to all seven counts against him, including conspiracy to violate the United States sanctions against Iran, newly unsealed court records show.

He has become the US government's star witness and will testify on Wednesday against former co-defendent Mehmet Hakan Atilla, at a trial that began this week in New York's Federal District Court.

Prosecutor David Denton Jr told jurors Zarrab would "tell you the story firsthand, as he lived it".

"The evidence is going to pull back the curtain on a fraud of truly global proportions," Denton said. "Billions of Iranian dollars moving in a scheme so large that it affected the economies of countries in the Middle East, and so large that it was protected by government ministers in Turkey and Iran."

The trial is expected to further strain relations between the US and Turkey, whose President Recep Tayyip Erdogan reportedly fears the case may reveal incriminating evidence about the government's involvement in helping Iran dodge US sanctions by using gold bullion to buy Iranian oil and laundering the money through US financial systems on Iran's behalf.

Erdogan has repeatedly asked the US government to free Zarrab, claiming the case is a move to undermine his country's economy.

There has also been speculation the plea deal includes Zarrab cooperating with Special Counsel Robert Mueller’s investigation of Russian inteference in the US presidential campaign, in which Turkey allegedly offered President Donald Trump's former national security adviser Michael Flynn money to secure Zarrab's release.

In the New York case, US prosecutors made clear they intend to introduce evidence collected in a 2013 Turkish corruption investigation, but never used in trial there because the case was thrown out by Erdogan's administration.

Zarrab paid bribes to make the probe go away, Denton said.

The Turkish evidence "did not see the light of day," Denton told jurors. "Until now."

In court on Tuesday, the government asked the judge Richard Berman to unseal court papers related to Zarrab's guilty plea.

They show that he also pleaded guilty to money laundering, bank fraud and a bribery conspiracy charge.

The bribery charge, which prosecutors had not previously made public, relates to payments Zarrab made to a corrections officer at the federal jail in New York where he is being held to get access to a mobile phone, alcohol and women.

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