NBC News reported that gold trader Reza Zarrab, a dual Turkish-Iranian national, is now cooperating with federal prosecutors in a money-laundering case, according to two sources with knowledge of the matter, and legal experts say prosecutors may be seeking information about any ties between the Turkish government and former National Security Advisor Mike Flynn.

Reza Zarrab, who is close to Turkish President Recep Erdogan, faces charges in federal court in Manhattan for skirting sanctions on Iran by allegedly moving hundreds of millions of dollars for the Iranian government and Iranian firms via offshore entities and bank accounts.

According to the report, Zarrab is now out of jail and speaking to prosecutors — a move President Erdogan had been desperately hoping to avoid.

Erdogan asked former Vice President Joe Biden in 2016 to drop the case and fire U.S. Attorney Preet Bharara, whose district was overseeing the case. Biden refused, according to a third source with knowledge of the case.

While President Donald Trump fired Bharara in March – with multiple law enforcement officials saying there is no indication at this time that the firing is tied to this case- Erdogan has continued to ask the Trump administration to drop the case, multiple officials say.

Special Counsel Robert Mueller is investigating whether Erdogan offered Flynn upwards of $15 million during the presidential transition in December to use his upcoming position as national security advisor to return his top political rival from the U.S. to Turkey and to see that Zarab's case was dropped, NBC has reported.

Attorney Danny Cevallos, a legal analyst for MSNBC and NBC News, says that given the relationship between Erdogan and Zarrab and the allegations of an improper relationship between Flynn and the Turkish government, Zarrab's decision to cooperate with federal prosecutors is a significant development.

"You can fill in the gaps that federal investigators are looking for any relation between Erdogan and Flynn," said Cevallos. "So, to the extent that Zarrab has any connection or knowledge of that, it is very important that they're flipping him."

Cevallos said that based on his experience and what he's read about the case, Zarrab's release from federal jail to federal custody is entirely consistent with someone who is cooperating.

Zarrab, 33, was arrested for allegedly evading sanctions on March 19, 2016 in Florida.