In Turkey, Trump has a ‘conflict of interest’
US leader’s foreign business dealings back in spotlight after he greenlights Turkish military moves in Syria
ByALISON TAHMIZIAN MEUSE, BEIRUT
Donald Trump’s abandonment of the Syrian Kurds – America’s foot soldiers in the war against ISIS – to a Turkish military incursion is casting a fresh glare on the US president’s business interests in Turkey.
“I have a little conflict of interest because I have a major major building in Istanbul,” Trump told Breitbart News in December 2015 during the heat of his campaign for the presidency. Upon assuming the presidency, Trump pledged to insulate himself from the running of his businesses but declined to relinquish ownership. 
“It’s called Trump Towers – two towers instead of one; not the usual one – it’s two,” Trump continued, calling the multipurpose retail, office and residential enterprise “tremendously successful.”
The admission came in response to a question about Turkey’s reliability as a NATO ally, in light of allegations Ankara was serving as a middleman for oil sales by ISIS and its perceived interest in the militant group remaining in control of those sources in Syria.
Trump currently faces impeachment proceedings over allegations he pressured the Ukrainian government to investigate a domestic rival, and that the White House sought to conceal records of the exchange.
At the time of the Breitbart interview, ISIS still held vast swathes of territory in northern and eastern Syria – territory which the US would empower Kurdish forces to seize, starting in September 2014 in the border town of Kobani.
That battle, remembered for dramatic scenes of Kurdish men and women fighters in action, was the beginning of an unlikely alliance between the PKK-aligned Kurdish guerrillas and the US armed forces.
Turkey – accused of having turned a blind eye to the mass movement of jihadists across its border – was in not in a strong position to oppose American support for its old enemy, the PKK.
Coalition crumbles
Flash forward to 2019: with Trump publicly asserting that the war against ISIS was finished and that US troops should come home, the justification for the US to back PKK-aligned forces appeared to be dissipating.
The time had come, in the eyes of Ankara, to begin operations against the Kurdish self-governing cantons which had emerged across the length of its southern border, and emboldened a new Kurdish-led political movement in its own southern provinces.
On Sunday night, Turkish President Recep Tayyip Erdogan wrangled the green light he had been seeking from Trump.
A phone call between the two leaders produced a White House statement that US troops would clear the way for a “long-planned” Turkish operation into northern Syria, a decision made with scant to no apparent warning to the US military and its partners on the ground.
Backlash from key Trump allies over the move triggered a hodgepodge of threats and justifications from the president, who issued a vague direction to Erdogan that he should not take the operation too far.
How far is too far remains unclear, but in the meantime, it appears Erdogan is set on getting his foot in the door – and is taking Trump at his word.
A senior adviser to the Turkish presidency told CNN’s Christiane Amanpour Wednesday night that “President Trump and President Erdogan have reached an understanding over precisely what this operation is.”
The two men are to meet face to face in Washington next month to discuss “further details” according to the advisor, suggesting that the operation could come in phases and will entail negotiations over matters of mutual concern.
For Erdogan and Trump, those issues get personal.
Trump Towers Istanbul
Hanging over Erdogan’s head is a fresh threat from Trump: to “totally destroy and obliterate” the Turkish economy should his Syria operation cause the US president a political headache ahead of looming impeachment proceedings.
One of the cards Trump holds is a pending fine to be levied on Halkbank, majority-owned by the government of Turkey, for its role in facilitating the transfer of billions of US dollars to the Iranian government.
In March 2016 – just two months after President Barack Obama lifted sanctions on Iran’s petroleum sector as part of a landmark nuclear agreement – US authorities arrested the high-flying Turkish-Iranian gold trader Reza Zarrab in Miami.
Federal prosecutors said that Zarrab – who maintained government contacts at the highest levels in Iran and Turkey – operated a network of companies in Turkey and the United Arab Emirates that he used to funnel Iranian oil and gas proceeds, held in accounts at Halkbank, back to Iran.
Zarrab also maintained an office in Trump Towers, Istanbul, Bloomberg reported in 2017.
Halkbank, identified as “Turkish Bank-1” in the court filing, is also accused of facilitating transactions by Iranian clients by disguising them as food and medical purchases – protected under a humanitarian exception.
“Turkish Bank-1 officials concealed the true nature of these transactions from officials with the US Department of the Treasury so that Turkish Bank-1 could supply billions of dollars’ worth of services to the Government of Iran without risking being sanctioned by the US,” the court filing read.
Prosecutors charged that Mehmet Hakan Atilla, the former deputy general manager of Halkbank, had orchestrated the elaborate scheme, and deliberately misrepresented the purchases to Treasury officials.
As the Erdogan fixer-turned-star witness, Zarrab in November 2017 testified that the Turkish president had directed the funneling of funds to Iran. The gold trader said he had paid millions of dollars in bribes to Turkey’s then-economy minister Zafer Caglayan and other high ranking individuals for their cooperation in the scheme.
The case is notable in that it embroils not only Erdogan allies and the Turkish president himself, but also Trump and his personal attorney Rudy Giuliani.
Before Zarrab flipped on Erdogan, the Turkish side attempted to avert trial – and embarrassing revelations of bribery in the ranks of the AKP – by retaining the services of Giuliani.
“I am still stunned by the fact that Rudy was hired to be – and he very actively pursued – being the ‘go between’ between President Trump and Turkey’s President Erdogan in an unprecedented effort to terminate this federal case in the middle of the case,” District Judge Richard Berman told Courthouse News reporter Adam Klasfeld in June of last year.
On Thursday, Bloomberg published a report that Trump had gotten personally involved in the proceedings, pressuring then-secretary of state Rex Tillerson in 2017 to lean on the Justice Department to drop the case. Tillerson refused.
“Trump appeared to be personally invested in having this case disappear,” Klasfeld, who has been closely tracking the case since its inception, told Asia Times.
In the end, federal prosecutors secured the cooperation of Zarrab, who has since disappeared – possibly into witness protection.
Former Halkbank executive Atilla, on the other hand, was set free in July and came home to a red carpet reception by Erdogan’s son-in-law, Finance Minister Berat Albayrak.
Atilla had served just 28 months in jail, despite prosecutors arguing for a penalty of 105 years.
The looming fine – which could be billions of dollars – could be one of the sticks in Trump’s arsenal against Turkey. A carrot is a renewed partnership on the production of the F-35. And of particular interest to the US president will be scuttling Turkey’s adoption of the S-400 in favor of the US-manufactured Patriot missile defense system.
Bipartisan legislation introduced in the US Senate on Wednesday calling for sanctions on US assets of Erdogan and his top cabinet members, as well as a halt to US military cooperation with Turkey, will also factor into the Turkish president’s calculations.
The two leaders are due to meet at the White House on November 13.
Meanwhile, Trump appears to be taking a page from the Erdogan playbook. He has blamed the Congressional impeachment challenge to his own rule on a “deep state” coup conspiracy.
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