Oct 6 (Reuters) - The Supreme Court declined on Monday

to hear another bid by Turkey's state-owned lender Halkbank

to avoid fraud, money laundering and conspiracy

charges in the United States for allegedly helping Iran evade

American economic sanctions.

The justices turned away Halkbank's appeal of a lower

court's ruling that let the criminal case brought by the U.S.

government proceed, allowing that decision to stand. The Supreme

Court in 2023 threw out a previous decision by the same lower

court that had permitted the case to move forward but at that

time rejected a key defense mounted by the bank.

Brought by U.S. federal prosecutors in 2019, the case has

been a thorn in U.S.-Turkey relations, with Turkish President

Tayyip Erdogan calling it an "unlawful, ugly" step.

Halkbank has pleaded not guilty.

Prosecutors with the Manhattan U.S. Attorney's office

accused Halkbank of using money servicers and front companies in

Iran, Turkey and the United Arab Emirates to help Iran evade

U.S. sanctions.

The bank secretly transferred $20 billion of restricted

funds, converted oil revenue into gold and cash to benefit

Iranian interests and documented fake food shipments to justify

transfers of oil proceeds, according to prosecutors.

In asking the Supreme Court to take up the case, Halkbank

argued that as a Turkish state-owned entity it should be immune

from legal actions in another country's courts.

In 2023, when the Supreme Court rejected Halkbank's

contention that it was protected under the federal Foreign

Sovereign Immunities Act, it directed the Manhattan-based 2nd

U.S. Circuit Court of Appeals to consider whether common law

provided immunity. Common law refers to legal principles

developed over centuries by judges, not by specific statutes.

The 2nd Circuit considered that issue and last year rejected

Halkbank's argument that common law principles immunized it from

prosecution related to commercial, nongovernmental activities.

President Donald Trump's administration asked the Supreme

Court to turn away Halkbank's appeal of that 2nd Circuit

decision. The Justice Department told the Supreme Court on

August 6 that "common law" principles do not shield foreign

state-owned companies from criminal prosecution.