(Bloomberg) -- Turkey is snubbing U.S. demands for one of its biggest banks to face charges that it helped Iran evade sanctions amid escalating tensions fueled by Turkey's incursion into northern Syria.U.S. prosecutors charged Turkiye Halk Bankasi AS last week with enabling a sanctions-evasion scheme that helped Iran tap $20 billion in frozen foreign oil sales revenue sitting in foreign bank accounts, at a time when the U.S. was trying to maximize leverage over the country in negotiations to abandon its nuclear program.The timing of the indictment led Turkish officials to dismiss the charges as false and politically motivated. The bank and its U.S. lawyers have refused to accept a legal summons or acknowledge U.S. legal authority in the matter. At a hearing Tuesday, no lawyers or executives showed up to represent the bank. A day earlier Turkey named a former executive at the bank, who'd been convicted in the U.S., to head the Istanbul stock exchange.Tensions between Turkey and the U.S. have heightened since President Donald Trump ordered the removal of U.S. troops from northern Syria, opening the door for Turkish President Recep Tayyip Erdogan to send his forces to attack Kurds in the region.The incursion spurred the U.S. to sanction Turkey with Trump writing a letter last week to Erdogan imploring him not to be a "tough guy" or a "fool." Erdogan reportedly threw the letter in the trash.Earlier, Trump threatened Turkey in a statement on Twitter.U.S. authorities had been pursuing a criminal case against the bank for at least a year, seeking to impose a massive financial penalty for its role in the scheme. But the case idled for months amid diplomatic wrangling until the charges were filed along with other sanctions last week.Read more on the charges hereFederal prosecutors with the Manhattan U.S. attorney's office have now deemed Halkbank a "fugitive," and told U.S. District Judge Richard M. Berman they may seek contempt sanctions if the bank fails to respond to renewed demands for its presence in court. Halkbank has no employees or offices in the U.S., though it does have a correspondent bank account and shares that are listed and traded as American depositary receipts in U.S. markets.The judge said he would consider the request but also said he wanted to give the bank two weeks to review the matter and reconsider its position.If Turkey's current position on the issue is any indication, it may take more than two weeks: on Monday, it named a former Halkbank executive who was convicted in a U.S. trial over the sanctions scheme as the new chief executive of the Istanbul stock exchange. The executive, Mehmet Hakan Atilla, was released from U.S. custody in July. In making the appointment, Turkish finance minister Berat Albayrak, who is also Erdogan's son-in-law, said Atilla was the victim of an "unjust conviction."(Corrects bank's name in second paragraph)To contact the reporter on this story: Christian Berthelsen in New York at email@example.comTo contact the editors responsible for this story: David Glovin at firstname.lastname@example.org, Joe SchneiderFor more articles like this, please visit us at bloomberg.comİ2019 Bloomberg L.P.