The second day of Reza Zarrab's confessions...

 

 

22:53 Now objecting to connection, authentication. Again, her objections aren't affecting admission of evidence - more perfunctory in case of appeal.

22:52 Cathy Fleming is objecting again to hearsay, foundation.

22:43 ZARRAB: "We had to do the gold export equivalent to the amount that we received in the money. I can show it on the drawing if they want." Judge says no to the art show, for now. Testimony continues.

22:43 They're looking at an exhibit of Zarrab's Royal Maritime transactions, and he's explaining the transactions and export. But honestly, the translator is butchering it a bit.

22:41 Testimony turns to Zarrab's company Royal Maritime

22:34 Basically, a lot of talk about how China was more responsible than Turkey in making sure there was no Iranian cash-gold trade happening. "As soon as they understood the money trade had something to do with Iran, they stopped it," Zarrab testifies.

22:33 They came to the conclusions that they would not be able to "pull this off," i.e. Iranian transactions in China, without bribing the Chinese official who's the equivalent of Halkbank general manager Suleyman Aslan, Zarrab said.

22:19 Zarrab said that Bayar told him their Chinese bank contact "is absolutely not allowing the same trade that we’re doing at Halkbank to [happen] in China."22:23 Testimony turns to another transcript of a phone call between Zarrab and associate Ruchan Bayar

22:15 The son was working for Zarrab while his dad was minister of the interior, Zarrab says. Zarrab said he met in person. Called over the telephone and messaged over WhatsApp

22:15 His son, Baris Guler, was working as a consultant for Zarrab's company at the time.

22:14 Zarrab says he asked son of minister of interior of that time for help. At that time, minister was Muammer Guler.

22:14 Zarrab said he contacted the Turkish minister of the interior’s son.

22:13 Zarrab says that the Chinese transactions had more trouble than in Turkey because they were nervous that the transactions had to do with Iran.

22:11 PROSECUTOR: The text contained in the email, does that relate to the business you were doing in China?

ZARRAB: Yes, it’s related to the Iranian trade.22:09 Another email. We're back to talking about the company Zarrab established in China, and a draft of a letter to banks in China.

22:07 We're back and the prosecutor jumps into transactions involving China.

20:40 OK, lunch break till 2pm. 

20:39 Zarrab says that banks cut him off from the China market when they realized that these dealings had to do with Iran.

Q: How long was he operating before he was stopped in China?
A: A few months.

20:36 Zarrab says it talked about establishing companies in China, to mimic system. Q: Did you ever establish a company in China? A: Yes sir.

20:33 Another email, this time from Ruchan Bayar, a Zarrab staffer. It was sent to Zarrab. It's from September 2012 - an information report or summary for Zarrab, on how to copy the system that worked in Turkey to China. Cathy Fleming objects: Foundation + hearsay.

20:29 Back to the meeting Zarrab had at Halkbank, about bringing Iranian money into Turkey. Q: Did you ever try to copy the system you had at Halkbank in any other country? A: Yes, we tried to. Q: What other countries? A: For example, in China.

20:28 "I was already bribing the Turkish minister of the economy," he explains. "I didn't feel I needed to pay any other" to others at Halkbank. Atilla also did not request bribes, Zarrab says. Zarrab says one of the payments he made to Zafer Caglayan was in the form of a watch. He did not specify if it was the $300,000 watch from the 2013 Turkish investigation.

20:27 Ah, he's clarifying: Sometimes they misattributed bribes to Aslan as ones they'd paid to Caglayan. But no big deal—Zarrab just paid Caglayan the extra 3 mil from his own account.

20:24 Zarrab seems to say that so many bribes were being paid, sometimes they paid the wrong guy, or the wrong amount.

20:23 Another payment says cash to the initials of Suleyman Aslan in the amount of 2 million euros.

20:22 One of the payments involves the purchase of a watch. No context given. Zarrab says he bought many watches, and they move on.

20:13 Now we're looking at an internal accounting record from Zarrab's company. This record tracks money paid out vs money being received from Iranian trade. It turns out, cheating sanctions isn't as lucrative as you'd think. 50% went to to Caglayan.

20:11 Cathy Fleming, the lawyer for Atilla, keeps objecting to the new transcripts, emails, etc. They keep getting allowed in, but she's forming the basis for a potential future appeal.

20:04 Zarrab testifies that he worried about being bumped form the transactions.

"I was fulfilling the int'l money orders given by Iranians, and the request from Iranians was for Halkbank to do this instead. If Halkbank would agree to do this, then I would be completely eliminated."

20:03 For all the talking Zarrab is doing, for all the dirt he's throwing at Aslan, Caglayan, Erdogan, Babacan, etc—Atilla's name comes out very infrequently. I think 10 hours into testimony, he's maybe come up... four times?

20:03 FWIW - All of these conversations are being read from transcripts and emails. We don't really have context. We don't know what other proof there is to back them up. It's actually kind of surprising, how much he's getting to talk. But I think it's part of Atilla's defense plan.

20:01 Zarrab testifying that he said bribing Suleyman Aslan was even more important than bribing Zafer Caglayan, bc Aslan was the ultimate gatekeeper.

19:58 Zarrab to Happani: “We will send two to Levent’s boss tomorrow morning. Keep it ready.” "Levent's boss" = Suleyman Aslan, Zarrab says

More context: Didn't explain this, but it appears to be a more likely reference to Caglayan (then-economic minister) than Erdogan (then-prime minister). 

More context: Zarrab said that he learned this from Zafer Caglayan

19:49 Zarrab: "Just like Sarmayeh, as I had drawn on the diagram, many Iranian banks have accounts under Halkbank."

19:45 Zarrab has mentioned Erdogan a few times and implicated him as having ok'd oil/money plot. HOWEVER he appears to have based that on info he heard secondhand. Seems like shaky testimony, which would have been subject to objection except that it had nothing to do with the defendant

19:42 Apparently Zarrab was worried that the Iranians would try to cut him out by getting the banks to make their payments directly. He worked with Suleyman Aslan to make sure that didn't happen.

19:40 Now he's back to testifying about Suleyman Aslan and Halkbank, and requests for direct payments by Iran. Compared to the bombshell from 20 minutes ago, this is tame.

19:16 Prosecutors like a dramatic cliffhanger. Now the trial is taking a mid-morning break.

19:11 ZARRAB: “Mr. Prime Minister” gave approval -- and an order to start doing that trade. "Mr. Prime Minister and Ali Babacan gave approval," Zarrab said in a phone conversation. "The prime minister at that time, Recep Tayyip Erdogan [and Babacan], had given instructions, had given an order, for [Ziraat and Viqaf banks] to start doing the trade."

19:07 In a reverse version of the scheme, money would come to A&P in euros, be transfered to Halkbank in Turkish liras.

19:06 One of the Indian companies Zarrab says was involved in the money transfer scheme: Bharat Oil.

19:04 "The hand washes the hand, then the hand washes the face."

What does this mean?

"What Mr. Suleyman is saying, by sending money from here from A&T we're helping them, and in return, they should help us, too," Zarrab explains.

19:02 Now they're circling back to the India scheme. Ozgur Eker from A&T bank is asking Zarrab if that's been ironed out.

Zarrab assures him it has.

18:57 Context unclear as to why the prosecutor asked this question at this time. Prosecutor may be setting the stage to explore later, or simply inform the jury about the political background.

18:55 "And at that time, who was the prime minister of Turkey?"

"Recep Tayyip Erdogan," Zarrab says.

18:54 Zarrab testifies that Ziraat Bank and Vaqif Bank were interested in getting in on the action.

18:51 "I was not going to do anything without his knowledge," Zarrab testifies. "And at the end of the day, we did not hide anything from Zafer Caglayan. We did not do anything without his knowledge."

18:50 Reza Zarrab just said that Zafer Caglayan, the minister of the economy, personally checked Zarrab's company's bank statements from time to time (!!!).

18:45 "I'm saying that, just like Zafer Caglayan, this one's asking for money, too," Reza Zarrab says.

18:42 He left the bank and called his right-hand man, Abdullah Happani.

My question: HOW DID THEY GET ALL THESE TAPES OF THE PRIVATE CALLS?

18:38 Oh i spoke too soon!

Suleyman Aslan told Reza Zarrab he was "feeling uncomfortable" with the large amount of risk he was taking.

18:28 "and since it was in Turkish liras, which meant it would go as EFT, Halkbank was saying it doesn't concern us, we can send it to whoever you would like. Because they were not concerned about international banking regulations."
18:22 Zarrab testifies that he and Eker talked about bringing money over from India to Turkey. It was going to be transferred from Halkbank to Arab Turk Bank.

"He wanted to ensure his future in some way."
18:14 Suleyman Aslan said this was not possible. "They would not be the intermediary for making international payments for Iran, but they could continue to make their payments through the existing system."

"He was pointing to me as the existing system," Reza Zarrab said.

"this one" = Suleyman Aslan, Halkbank GM.

18:09 Second topic of discussion at the mtg: That Halkbank ease on the application of regulations, and allow them to make international payments directly.

This request was made by Bijan Alipour.
18:07 Zarrab would take it from the second Turkish bank in exchange for gold, change it to cash, and make the international payments.

18:03 They were talking about transferring the money accumulated from crude oil sales to India, Zarrab says. "Secondly, the Iranians put pressure and made a request from Halkbank to be able to make their international payments."

Zarrab will diagram some more.

18:02 Now, Zarrab is talking about another meeting between Halkbank and the Iranians. Atilla, who is the man on trial, comes up for the first time today.
18:00 Another call, between Reza Zarrab and the chief of traffic at the Istanbul police. He was running late for a meeting:

"So I asked for permission from the chief of traffic at the Istanbul traffic department for me to be able to use the emergency lane to be able to get there."

17:57 ZARRAB: "A meeting between [Turkish ex-economic minister] Zafer Caglayan and Iranians occurred many times — that I also attended."

17:54 Zarrab now being questioned about a transcript of a phone conversation with Onur Kaya
17:50 Diagram time again: Zarrab is about to map out transactions again for the jury at the easel.

17:49 Also included Indian businesspeople. The meeting was about how to move the money that had accumulated in India to Turkey.

This is a new development in the cash-for-gold scheme, Zarrab is going back to the diagram he drew yesterday to add more explanation.

17:46 Now, Reza is testifying about a meeting with NIOC, Naftiran, and other Iranians, incl. Bijan Alipour, Rejai.

17:42 Reza Zarrab confirms he was threatened while in federal detention in Manhattan. "Why were you moved into the custody of the FBI?" "For security purposes, for the threats that I have received while in the detention center."

17:40 First Q to Reza Zarrab: Why are you wearing different clothes?

"My lawyers informed me yesterday I could wear different clothes, with the permission of the honorable judge. So I'm wearing the clothes they brought for me."

17:38 The jury is now entered. Everyone in the courtroom stands, with proceedings about to begin.

17:31 The court is still waiting for one juror before things get started. Very quiet in the courtroom for now.