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Russia used US banks to send billions to Turkey, dodging sanctions, WSJ reports

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Russia used US banks to send billions to Turkey, dodging sanctions, WSJ reports
Russia's President Vladimir Putin (L) shakes hands with his Turkey's counterpart Recep Tayyip Erdogan during their meeting in Tehran on September 7, 2018. (Kirill KUDRYAVTSEV /AFP via Getty Images)

A U.S. Justice Department investigation found that Russia funneled billions of dollars through American banks to Turkey in 2022, using the Akkuyu nuclear power plant project as cover to evade sanctions, according to the Wall Street Journal (WSJ).

JPMorgan Chase and Citigroup facilitated more than $5 billion in transfers linked to the Russian-backed project, with at least $2 billion later frozen by U.S. authorities.

The Justice Department suspects the scheme was orchestrated at the highest levels in Moscow, with the Bank of Russia secretly funding a $9 billion loan through Gazprombank. This allowed Russian money to flow into Turkey while avoiding direct transactions with sanctioned entities. Officials believe the transfers were designed not just for nuclear construction but also to create an offshore dollar reserve for Russian state initiatives.

Despite prosecutors’ efforts to seize the frozen funds in 2024, the Biden administration halted the case, fearing diplomatic fallout with Turkey, a NATO ally.

The White House and State Department worried legal action could strain cooperation on prisoner exchanges, counterterrorism, and Middle East stability. A key concern was the suspected involvement of Turkish intelligence chief Ibrahim Kalin and former finance minister Nureddin Nebati in facilitating the payments.

Turkey, unlike other NATO members, has refused to impose sanctions on Russia and has expanded trade with Moscow while simultaneously providing weapons to Ukraine. The country’s financial system benefited from the Russian transfers as the Turkish central bank sought to stabilize the lira amid inflation.

With the case now on hold, the Trump administration must decide whether to pursue action. During his first term, tensions flared between Washington and Ankara over sanctions violations involving Turkey’s state-owned Halkbank.

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Olena Goncharova

Head of North America desk

Olena Goncharova is the Head of North America desk at The Kyiv Independent, where she has previously worked as a development manager and Canadian correspondent. She first joined the Kyiv Post, Ukraine's oldest English-language newspaper, as a staff writer in January 2012 and became the newspaper’s Canadian correspondent in June 2018. She is based in Edmonton, Alberta. Olena has a master’s degree in publishing and editing from the Institute of Journalism in Taras Shevchenko National University in Kyiv. Olena was a 2016 Alfred Friendly Press Partners fellow who worked for the Pittsburgh Post-Gazette for six months. The program is administered by the University of Missouri School of Journalism in Columbia.

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