Money laundering scandal could embarrass high-profile Turks
The controversial 43-year-old, better known by his initials SBK, started his working life as a shoeshine boy before rising up through the business world with vertiginous speed. He ultimately became a billionaire known for generously distributing money for humanitarian purposes. He purchased, for relatively modest amounts, companies that were in financial difficulty, rehabilitated them and sold them for exorbitant prices.
His name came back on to the agenda last month, when Sedat Peker, a ringleader in Turkey’s criminal underworld, mentioned it to embarrass Interior Minister Suleyman Soylu. He claimed that Soylu had received SBK last December and intimated to him that a legal procedure had been initiated against him and that he should leave Turkey at once. SBK followed the minister’s advice and left the country the following day.
The origins of the story go back several months. In September last year, a court in Istanbul blocked SBK’s bank accounts and banned him from leaving the country. On Nov. 6, another Istanbul court, on the advice of the public prosecutor, reversed both these actions.
The first stink started to emanate when the public prosecutor who advised the court to lift the block on SBK’s bank account was promoted just 10 days later to the position of deputy minister of justice.
To make the affair more suspicious, the court verdict referred to a report by the Financial Crimes Investigation Board (MASAK) that concluded that the question of money laundering had to be investigated by professional auditors. It appears that the Istanbul court preferred to disagree with MASAK’s suggestion and lifted the ban without waiting for the auditors’ conclusions. The final version of the MASAK report, dated Jan. 20, concluded that money laundering had indeed taken place. But SBK had already left Turkey by that time.
After his arrest in Austria, SBK confessed that, during the religious holidays, he used to distribute gifts in Istanbul worth $3 million to bureaucrats and members of the judiciary, but more specifically to police officers and inspectors. So we now know how this wheel of corruption was turning.
The affair has become more complicated as new irregularities have surfaced about Korkmaz
SBK’s arrest warrant originated from a court in Salt Lake City, Utah. An American company was receiving a subsidy from the US government, claiming that it was producing biodiesel. The amount of the subsidy was $511 million, of which $133 million was sent to SBK for laundering in Turkey. The owner of the American company, which misled the US authorities by claiming that biodiesel was being produced, was arrested as he was preparing to travel to Turkey. The US authorities now want SBK to return this money.
The opposition media in Turkey questions whether it was appropriate for an interior minister to share insider information about a businessman’s potential arrest. The affair has now become more complicated as new irregularities have surfaced about SBK, which means a bigger headache for Turkey. This incident is likely to remain a thorny issue in Turkish-US relations.
The Turkish government has chosen to keep a low profile because there is little ammunition left to fight back with.
As if the affair was not complicated enough, SBK, a few days before his arrest, had opened a new debate by claiming that Veyis Ates, a veteran media figure in the pro-government television channel Haberturk, called him and proposed eliminating his problems. He released part of a telephone recording, in which Ates says: “If you give me €10 million ($12 million), I may help sort out your problems with the Turkish authorities through influential people.” SBK leaked only a three-minute segment of the recorded conversation and refused to release the remainder to avoid the disclosure of the names of important people.
The Austrian authorities may extradite SBK to the US, as Washington was the first to place an extradition request. But they may prefer to extradite him to Turkey because he is a Turkish citizen.
If SBK, who faces a lengthy prison sentence if convicted in the US, cooperates with prosecutors, what he says could cause serious embarrassment for many important people in Turkey. However, if he is tried in the Turkish courts, he may not go to jail at all because the country’s laws are not severe when it comes to punishing money laundering. Even if he is convicted, the Turkish parliament may pass another law to pardon his financial irregularities, as it has done several times in the past. Transparency is going steadily downhill in Turkey.
• Yasar Yakis is a former foreign minister of Turkey and founding member of the ruling AK Party. Twitter: @yakis_yasar