Iran gold smuggling case witness Reza Zarrab suffers death threats after imprisonment for violating sanctions

Reza Zarrab, the chief government witness in a trial involving a billion-dollar scheme to smuggle gold for oil in violation of United States sanctions on Iran, testified on Thursday that his life had been threatened in a federal detention centre in New York after he began cooperating with the prosecution.

A fellow inmate, saying he had been given instructions to kill him, pulled a knife on him, Mr Zarrab said.

“I was about to lose my life,” he told the jury.

“He said that he had heard that I was cooperating — that’s why he was doing it,” Mr Zarrab added.

As a result of the threat, he was removed from the Brooklyn jail and placed in the FBI’s custody at an undisclosed location.

Mr Zarrab, 34, told the jury that had he not chosen to cooperate, it is possible that he would never have been threatened.

“But did you choose to be a witness anyway?” a prosecutor, Sidhardha Kamaraju said.

“I’m here now,” Mr Zarrab responded. “Yes, sir.”

The testimony in Federal District Court in Manhattan came on Mr Zarrab’s seventh and final day on the witness stand in the trial of a Turkish banker, Mehmet Hakan Atilla, who was also charged in the scheme.

Mr Zarrab’s wide-ranging account suggested that a high-level Turkish official — who was not named but from the testimony and trial exhibits appears to be Recep Tayyip Erdogan, now Turkey’s president - had more extensive knowledge of the sanctions-busting activity than had been disclosed previously.

Last week, Mr Zarrab testified that he had been told that Mr Erdogan gave orders in 2012, when he was prime minister, that two Turkish banks be allowed to participate in the scheme, which Mr Zarrab, a Turkish-Iranian gold trader, helped orchestrate.

Mr Erdogan has repeatedly denounced the case as a fabrication.

Mr Zarrab, responding to the prosecutor’s questions, also described the toll his cooperation had taken. He noted that while he was testifying for the government last week, prosecutors back in Turkey ordered the seizure of his assets and those of nearly 20 other people.

Turkish officials cited a part of the Turkish penal code that concerns the leaking of state secrets.

“What I’m doing here is being assessed as espionage,” Mr Zarrab said, “and it is as if I had obtained all these assets based on my cooperation here.”

In an unrelated legal action, on Wednesday Mr Zarrab was sued by an inmate who claims Mr Zarrab sexually assaulted him when the men shared a cell in a different jail, the Metropolitan Correctional Center, in Manhattan.

The inmate’s lawsuit said the abuse, which included rape, occurred between November 2016 and March 2017, when the men were cellmates.

Robert Anello, a lawyer for Mr Zarrab, said on Thursday, “The allegations are outrageous and false from a source that is not remotely credible.”

The inmate’s lawyer, Alexei Schacht, said an inquiry by the jail had found the complaint to be unsubstantiated. That meant, he said, only that officials there had concluded there was insufficient evidence to establish whether the assault had occurred.

A spokesman for the jail did not respond to a request for comment.

The inmate, who is not being identified because he is an alleged sexual assault victim, claims in the suit that he and Mr Zarrab became friends in the jail and that Mr Zarrab offered to pay for him to retain a private lawyer. Mr Zarrab also had money wired to the inmate’s family in Africa and placed in the inmate’s commissary account, the lawsuit says.

The inmate, who is in his early sixties “felt helpless and unable to fight off the younger and stronger” man, the suit says, adding that the inmate was also “too scared and embarrassed at that time to complain or to seek help.”

On 8 March, the suit says, after the inmate again was attacked by Mr Zarrab and began yelling and making noise, other inmates apparently complained to jail officials, as did the inmate himself.

“Being in jail is a bad enough experience for someone,” said Mr Schacht, the inmate’s lawyer, “and this just made his experience so much worse.”

The inmate pleaded guilty in July to one count of conspiring to provide material support for a terrorist group and is awaiting sentencing in the federal court in Manhattan.

Mr Schacht, asked why he had filed the suit the week Mr Zarrab was testifying in the sanctions case, said the timing was coincidental and largely a factor of his being retained recently to represent the inmate and of conducting his own investigation.

A spokeswoman for the United States Attorney’s office in Manhattan declined to comment.

New York Times