Foreign immunity is not extended to entities aiding in sanctions evasion.
The Second Circuit U.S. Court of Appeals ruled that the federal government may prosecute Turkish bank Halkbank in a Department of Justice (DOJ) probe investigating sanctions evasion.
The Justice Department alleges that Halkbank aided in the evasion of U.S. sanctions by distributing money on behalf of Iran and the United Arab Emirates. The department is attempting to prosecute the instances of this activity that occurred within the United States. Halkbank is owned by the government of Turkey, and attempted to argue that, since Halkbank is a governmental entity, it has legal immunity from prosecution in the United States.
Circuit Judge Joseph Bianco, writing on behalf of a three-judge panel that voted unanimously against this argument, said that there is a distinction between governmental and commercial operations.
Judge Bianco wrote, “Although certain prior cases extended immunity to state-owned corporations based on their governmental conduct, the common law places no independent bar on the prosecution of such corporations for their commercial activity.”
He also noted that a decision to prosecute foreign state-owned companies such as Halkbank, rather than impose tariffs or deny military aid to their state sponsors, “is not one for the judiciary to second guess.”
Halkbank is appealing the decision.
As the Lord Leads, Pray with Us…
- For U.S. federal judges as they deliberate questions of immunity in various offices and instances.
- For Justice Department officials as they pursue the case against the Turkish bank.
Sources: Reuters, Wall Street Journal
