The <a href="https://www.thenationalnews.com/world/us-news/2022/12/27/us-supreme-court-leaves-pandemic-era-border-curbs-in-place/" target="_blank">US Supreme Court</a> will hear arguments on Tuesday in a request by<a href="https://www.thenationalnews.com/world/us-news/2022/11/29/us-tells-turkey-ground-incursion-in-syria-will-not-resolve-its-security-concerns/" target="_blank"> Turkey's</a> Halkbank to counter claims that it violated sanctions on Iran. The justices are weighing Halkbank's appeal of a lower court's ruling in favour of the US government that allowed the prosecution of the bank to proceed. The case tests Halkbank's contention that, as a state-owned bank, it has immunity under the US Foreign Sovereign Immunities Act. The case has complicated US-Turkish relations, with Turkish President Recep Tayyip Erdogan calling the 2019 American charges an “unlawful, ugly” proceeding. Prosecutors accused Halkbank of converting oil revenue into gold and then cash to benefit Iranian interests, and falsifying humanitarian aid shipments to justify transfers of oil proceeds. They also said Halkbank helped Iran secretly transfer $20 billion of restricted funds, with at least $1 billion laundered through the US financial system. The Department of Justice said it had charged the bank with six counts of fraud, money laundering and sanctions offences, calling it one of the most serious sanctions-breaking cases it has seen. Halkbank says that the Foreign Sovereign Immunities Act, which protects foreign leaders and governments from lawsuits in the US, extends to state-owned businesses. US courts have disagreed, and the issue is now to be decided by the Supreme Court. But the case is underpinned by the politics of US relations with Turkey, a Nato ally and an important power in Middle East politics. Several people have already been found guilty in the case, including Mehmet Hakan Atilla, a deputy director general of the bank, who was convicted in 2018. Atilla was jailed for a year and then released in 2019, and was greeted as a hero upon his return to Turkey. <i>Agencies contributed to this report</i>