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A Manhattan Trial Wreaks Havoc on Turkish Markets: QuickTake Q&A

Reza Zarrab in 2013
Reza Zarrab in 2013Photographer: OZAN KOSE/AFP
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The trial in New York of Turkish banker Mehmet Hakan Atilla, who is accused of conspiring to evade U.S. sanctions on Iran, has been wreaking havoc on Turkey’s markets, following efforts led by President Recep Tayyip Erdogan to scuttle the case. Many investors want to see what is revealed in that Manhattan courtroom before taking a risk on Turkey.

They’re looking for any clues that U.S. authorities will penalize Turkey or its banks. While there’s been no indication of an intent to do so from the U.S., prosecutors are alleging that the scheme was devised by executives at state-run Halkbank -- formally, Turkiye Halk Bankasi AS -- and facilitated through the corruption and involvement of senior officials in Turkey’s government. Bekir Bozdag, the Turkish government’s spokesman, has fueled concerns by repeatedly saying that the case is an attempt to cripple Turkey’s economy through the imposition of sanctions.