Rudy Giuliani and Michael Mukasey
Rudy Giuliani and Michael Mukasey ()

A federal judge has ordered a hearing to address whether former New York City Mayor Rudolph Giuliani and former U.S. Attorney General Michael Mukasey have a conflict of interest in a case where they represent a Turkish gold trader charged with helping Iran violate sanctions imposed by Congress.

In letters to the court last week Benjamin Brafman of Brafman & Associates, a member of defendant Reza Zarrab’s legal team, said that Giuliani and Mukasey are serving “ancillary” roles in the case and will not appear before the court, assist in trial preparation or take part in plea negotiations with prosecutors.

Presiding in the case is Southern District Judge Richard Berman.

In February, Giuliani and Mukasey both traveled to Turkey to discuss Zarrab’s case with Turkish President Recep Tayyip Erdogan. They informed then-Southern District U.S. Attorney Preet Bharara and U.S. Attorney General Jeff Sessions about the trip prior to their departure.

“This isn’t an attempt to backdoor the Southern District,” Brafman said on Monday at a conference before Berman. “I’ve made that clear to them.”

Giuliani, who served in the 1980s as U.S. Attorney for the Southern District of New York, is senior adviser to Greenberg Traurig and Mukasey is of counsel to Debevoise & Plimpton.

Reza Zarrab

Greenberg Traurig and Debevoise both represent banks that say they were defrauded by Reza Zarrab, who is also being charged with conspiracy to commit bank fraud and conspiracy to commit money laundering.

The victim-banks, which prosecutors say were tricked into processing prohibited transactions by Iranian entities, are Deutsche Bank, Bank of America, JPMorgan Chase & Co., Citibank, HSBC, Standard Chartered, UBS and Wells Fargo.

Greenberg Traurig is also a registered agent for the Turkish government, according to court papers.

At the Monday conference, Berman ordered a Curcio hearing in the case to discuss and address potential conflicts of interest, which he said would be held later this month.

Zarrab was brought into the courtroom for the conference. Dressed in a dark blue jail uniform, he listened to the proceedings with the help of a Turkish language translator.

Zarrab was arrested in Florida in March 2016 and, in October 2016, Berman denied his motion to dismiss.

The Southern District U.S. Attorney’s Office, now under the leadership of Acting U.S. Attorney Joon Kim, had moved the Curcio hearing, arguing that Giuliani and Mukasey are playing a “key”—rather than “ancillary”—role in United States v. Zarrab, 15-cr-867, and that Zarrab’s Sixth Amendment right to conflict-free counsel may be affected by their representation.

Assistant U.S. attorney Michael Lockard said at the conference that “it is clear” that Giuliani and Mukasey have been brought into the case to affect its disposition and that a Curcio hearing is needed to protect the “finality of judgment in the case.”

Assistant U.S. attorneys Sidhardha Kamaraju and David Denton are also appearing for prosecutors in the case.

Zarrab’s lawyers had initially pushed back against holding a Curcio hearing, but in a letter sent on March 31, Brafman said the defense would consent to one. He also wrote that the “government is not entitled to know” what Giuliani and Mukasey are doing to assist Zarrab.

“That information quite frankly is none of the government’s business and in any event is covered by the attorney-client privilege and/or constitutes privileged attorney work product,” Brafman wrote.

This is not the first time a Curcio hearing has been called in the case to assess potential conflicts of interest by Zarrab’s legal team, which, in addition to Brafman and Brafman & Associates attorneys Marc Antony Agnifilo and Joshua Kirshner, includes lawyers from Kirkland & Ellis and Ferrari & Associates.

The first time, prosecutors raised concerns about Kirkland & Ellis attorneys representing both Zarrab and victim-banks in the case that led to Curcio proceedings that lasted from November 2016 to February, when Berman ruled that Zarrab knowingly accepts the potential conflicts presented by Kirkland & Ellis’ representation.

New York University School of Law professor Stephen Gillers submitted expert statements in the case to oppose the government’s motion to disqualify Kirkland, arguing that the firm’s representation of Zarrab complies with the New York Rules of Professional Conduct. “Disqualifying Kirkland because of what it cannot do will deny Mr. Zarrab his chosen counsel for the work it can do. He loses something and gets nothing in return,” Gillers wrote.

Bruce Green—a law professor who directs the Louis Stein Center for Law and Ethics at the Fordham University School of Law—who said he knows of Zarrab’s case through news reports, said that Curcio proceedings can be used to determine if it is legally permissible for a defendant to waive their Sixth Amendment rights and can lower the risk of a ruling being reversed on appeal.

“Sometimes you have conflict that are just so serious that the courts can’t allow the defendant to waive the conflict,” Green said. He also said Berman would have the option to appoint Curcio counsel in the case to discuss potential conflicts of interest.

A Curcio hearing is named for the 1982 case United States v. Curcio, 680 F.2d 881, in which the U.S. Court of Appeals for the Second Circuit disqualified the lawyer—who had represented each of two brothers in criminal matters dating back to 1969—in a case in which they were co-defendants charged with extortionate extensions of credit, finding they did not make a “knowing and intelligent” waiver of their rights to conflict-free counsel.

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