(Adds reaction from Turkey)
By Brendan Pierson
NEW YORK, May 16 (Reuters) - A U.S. judge sentenced Mehmet Hakan Atilla, a banker at Turkey's state-controlled Halkbank , to 32 months in prison on Wednesday after he was convicted earlier this year of taking part in a scheme to help Iran evade U.S. sanctions.
Atilla, a 47-year-old Turkish citizen, was sentenced by U.S. District Judge Richard Berman in Manhattan. The sentence drew sharp condemnation from Turkey, a NATO ally of the United States, underscoring the diplomatic tension the case has generated between the two countries.
"By sentencing the representative of a foreign country's state bank, the court in question has made a decision on the application of regulations regarding U.S. sanctions that has no precedent," the Turkish Foreign Ministry said in a statement.
U.S. prosecutors accused Atilla of joining a plot led by Reza Zarrab, a wealthy Turkish-Iranian gold trader, who U.S. authorities arrested in 2016 and later pleaded guilty to fraud, conspiracy and money laundering charges. Zarrab testified for several days as the prosecutors' star witness against Atilla.
Victor Rocco, one of Atilla's lawyers, said his client would appeal his conviction, but called the sentence "fair."
Atilla, who worked as a deputy general manager at Halkbank, has already spent 14 months in jail since his arrest last year. That time will count toward his sentence, and he may be freed early for good behavior.
There was no immediate response to the sentencing from Halkbank. The bank has previously said that all of its transactions have been lawful.
Prosecutors had sought a sentence of about 20 years for Atilla, who worked as a deputy general manager at Halkbank.
Berman said before imposing his sentence, however, that the evidence at trial showed Atilla was a minor player in the sanctions-dodging scheme, and "at times a reluctant one at that" who was largely following orders from his supervisor.
Berman also said Atilla "appears to have led an exemplary life in Turkey," pointing to more than a hundred letters he received from Atilla's family and friends in his support.
Rocco agreed that leniency was justified.
"What we need to show the world in proceedings such as this - especially today, especially now - is that we Americans aren't bullies," he said.
Cathy Fleming, another of Atilla's lawyers, read a brief statement by Atilla, translated from Turkish, asking for Berman's "understanding of the situation that I and my family are in."
"Apart from my family, I have no other priorities," the statement read.
U.S. prosecutors said that beginning around 2012, Atilla helped Iran spend oil and gas revenues abroad using fraudulent gold and food transactions through Halkbank, in violation of U.S. sanctions.
Atilla was found guilty on Jan. 3 of conspiring to violate U.S. sanctions law following a four-week-long trial, during which Atilla testified that he was innocent.
Zarrab, who has yet to be sentenced, testified during the trial that he bribed Turkish officials and that Turkish President Tayyip Erdogan personally signed off on parts of the scheme while serving as prime minister.
Erdogan has said the case was based on evidence fabricated by followers of U.S.-based Muslim cleric Fethullah Gulen, whom he has also blamed for a failed 2016 coup attempt.
Turkey's Foreign Ministry repeated that claim in its statement on Wednesday, saying that "fake evidence" had "destroyed the reliability and credibility of the trial." (Reporting by Brendan Pierson in New York; additional reporting by Tuvan Gumrukcu in Ankara; editing by Frances Kerry, Jonathan Oatis and G Crosse)
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