Wednesday, July 6

Turkish Businessman Arrested in Austria on U.S. Fraud Charges

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(Bloomberg) — A Turkish businessman was arrested in Austria over the weekend at the request of U.S. prosecutors who have charged him with helping a Los Angeles businessman and members of a Utah polygamist family launder $133 million.

Sezgin Baran Korkmaz was accused of conspiring with businessman Lev Dermen and members of the Kingston family to launder proceeds defrauded from a U.S. program to promote clean fuels, according to an April 28 indictment unsealed Monday in Salt Lake City.

Korkmaz was detained on June 19 by Austrian authorities, the Justice Department said in a statement on Monday. The government said it would seek his Korkmaz’s extradition to face trial in the U.S., where he could face up to 20 years in prison if convicted of money-laundering conspiracy.

Korkmaz’s U.S. lawyer didn’t respond to a request for comment.

The indictment arose from the case against Dermen, who was convicted at trial last year, and Jacob and Isaiah Kingston, who pleaded guilty along with two other family members. Prosecutors said they cheated U.S. tax authorities of nearly $500 million by filing false claims for renewable energy tax credits and laundered $133 million through bank accounts in Turkey and Luxembourg controlled by Korkmaz. Dermen and Korkmaz were close friends at the time of alleged conspiracy, prosecutors said at trial.

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Korkmaz used the fraud proceeds to buy pharmaceutical and technology companies in Turkey, an asset management company, a hospital, two hotels in Switzerland, a jet, and a yacht named the Queen Anne, according to the indictment. Prosecutors said they are seeking to seize the yacht through a forfeiture action.

Korkmaz also is charged with wire fraud for allegedly defrauding Jacob and Isaiah Kingston of $6 million by promising to shield them from the criminal investigation. Korkmaz is also accused of obstructing the investigation by making false statements to federal authorities during interviews over two days in April 2019.

The U.S. indictment could set up a legal fight in Austria over Korkmaz’s extradition.

Turkish authorities last year charged Korkmaz with money-laundering over the same scheme, and an Istanbul court has issued an arrest warrant in absentia against him. Ozan Ceyhun, the Turkish ambassador to Austria, said Turkey has asked Austria to extradite Korkmaz to his native country.

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