The former national security adviser to President Donald Trump and his son, Mike Flynn Jr, would have been paid up to $15 million for delivering Gulen to Turkey, according to sources familiar with the investigation who spoke to the Wall Street Journal.
Erdogan has repeatedly pressed USA officials to extradite the cleric, Fethullah Gulen, who lives in Pennsylvania.
The meeting allegedly took place at the upscale 21 Club restaurant in NY, just blocks always from Trump Tower where Flynn was serving on the presidential transition team.
In October Reuters reported that one of Flynn's business associates, former Central Intelligence Agency director James Woolsey, pitched a $10 million contract to two Turkish businessmen to help discredit Gulen while Mr Woolsey was an adviser to Trump's election campaign. But that the special counsel is looking into the allegations adds to the breadth of probe into Flynn, who has already come under scrutiny for work benefitting the Turkish government.
He was forced to resign from his White House job in February - just 24 days into his tenure - after it was revealed that he had lied to Vice President Pence about his conversations with the Russian ambassador in the month before Trump took office. All the while new reports regarding the investigation's latest developments continue to turn up, like a recent Wall Street Journal article detailing a lucrative financial deal between the Flynns and Turkey. The New York Times reported that Giuliani met with Erdogan in late February and discussed an agreement under which Zarrab would be freed in exchange for Turkey's help furthering USA interests in the region.
The possibility of the multimillion-dollar deal involving Flynn and Turkey arose as investigators examined Flynn's past dealings with foreign governments. Flynn did not register as a foreign agent at the time, as is required in the USA for anyone working for a foreign government.
Mr Woolsey was a member of Flynn's firm, the Flynn Intel Group, according to a Justice Department filing by the firm and an archive of the company's website.
George Papadopoulos, a former foreign policy adviser on the Trump campaign, was also charged with lying to the Federal Bureau of Investigation about contacts he had with people with ties to the Russian government.
Flynn was a senior adviser on national security matters to the Trump campaign at the time, though he was also on a foreign government's payroll.