But Court Gives Turkish Bank Another Chance to Avoid Charges Under Common-Law Sovereign Immunity
On April 19, 2023, the United States Supreme Court issued a highly-anticipated decision in the case of Turkiye Halk Bankasi A.S., aka Halkbank v. United States. The court ruled that Turkish state-owned Halkbank remained subject to criminal prosecution in U.S. courts under the Foreign Sovereign Immunities Act (“FSIA”) for fraud, money laundering and sanctions-related charges related to the bank’s alleged participation in a multi-billion dollar scheme to evade U.S. sanctions involving Iran. Specifically, in a seven to two decision, the Court held that the FSIA does not provide foreign states and their instrumentalities with immunity from U.S. criminal proceedings. However, the Court remanded the case back to the Court of Appeals for the Second Circuit to determine whether Halkbank still can claim sovereign immunity under common law principles. The Court’s opinion clearly extends beyond just financial institutions owned by foreign governments, and instead implicates any number of foreign state-owned entities.