After years of turning a blind eye to organized crime under former Interior minister Suleyman Soylu, Turkey is finally taking the problem seriously, thanks to the law-and-order crusader Ali Yerlikaya with aid from Mehmet Simsek
“My dear nation, today we caught three internationally sought-after gang bosses in Alanya and Istanbul,” Interior Minister Ali Yerlikaya announced to the Turkish people on social media earlier this week, declaring himself ready for the fight. “No matter how strong these gangs are or whatever arrest warrant they face, we will choke them out.”
Ever since Yerlikaya took office in June, barely a day has gone by without the arrest of serious criminals. Drug dealers, loan sharks, human traffickers, fraudsters and thieves, but also the bosses of major international gangs who have sunk their teeth into Turkey in recent years.
Why Turkey?
For years, there have been signs that international networks have made inroads in Turkey: shootings, assassinations and a handful of journalistic investigations. But before Yerlikaya took office, there were hardly any major probes or charges.
Yerlikaya’s predecessor, Suleyman Soylu, has been accused of having close ties with gang members. While Soylu was in office, leading gang figures from the Turkish underworld were released from prison, allowing Turkey to develop into a haven for international criminals, particularly from Serbia, Albania, Azerbaijan, Russia and Montenegro.
Already in 2022, the German Federal Criminal Police Office told DW that Turkey had for some time served as a haven for criminal networks from the western Balkans.
Lax laws and golden passports
According to experts, there are crucial reasons why Turkey has become a home away from home for many criminals. First, the country has weak laws on money laundering. Second, the government issues almost annual amnesties for economic criminals. Third, it’s possible to enter Turkey without a visa for nationals for many states. And fourth, the rich can easily get Turkish passports.
Anyone who invests $500,000 in Turkey or deposits it in a bank account, or anyone who buys property worth $400,000, can apply for Turkish citizenship. Kristin Surak, an expert from the London School of Economics who has written a book about so-called “golden passports”, said more than 50,000 people get their hands on citizenship in this way every year worldwide. Around half of those are given out by the Turkish state.
Furkan Sezer, former head of the Istanbul police economic crime department, has been observing this world for years. According to him, many criminals first apply for naturalization and then bring their assets into the country.
Thanks to annual amnesties, this too is very easy. The system allows people or legal entities to report their unregistered assets from abroad or domestically to the tax authorities, sometimes without having to pay tax on them. In this way, money of unknown origin ends up circulating in the legal economy. “Criminals usually pay 15 to 20% of the value for money laundering,” said Ozan Bingol, an expert in tax law.
There are also holes in the law for crypto investments, which the tax expert said attracts international criminal networks to Turkey. Such investments are in urgent need of regulation, he added.
Turkey on the ‘gray list’ for money laundering
The international institute against money laundering and terrorist financing, the Financial Action Task Force, has also taken Ankara to task for its lackluster policing of money laundering.
It placed the country on its so-called “gray list” two years ago. Since then, Turkey has been under closer scrutiny. Ankara is aiming to be removed from this list at the next review date in June, especially since the economy is already ailing. Erdogan’s interference in monetary policy and the judiciary has also scared off foreign investors.
To make this happen, however, everyone has to deliver. The pressure is not just on Simsek — a lot is also riding on Interior Minister Yerlikaya and his fight against organized crime.
Crackdown spreads to social media influencers
In the wake of the high-profile arrest of Turkish influencer Dilan Polat and her husband on charges of money laundering and tax evasion, the Treasury and Finance Ministry has established a team to investigate social media figures.
The move comes as authorities intensify efforts to combat financial crimes within the influencer community.
The team – comprised of revenue experts, tax inspectors and Financial Crimes Investigation Board (MASAK) experts – is conducting tax audits on influencers. MASAK intervenes if there are suspicions of money laundering, and any detected criminal offenses are promptly reported to the prosecutor’s office.
While the primary focus has been on tax examinations, the team has unveiled a range of unconventional channels through which influencers are allegedly funneling black money. Contrary to common belief that beauty centers were the primary method, the investigation has revealed the involvement of influencers in activities such as virtual illegal betting.
Despite a trend among influencers to delete their accounts following the crackdown on the Polat couple, the experts assert that their investigations remain unaffected. The team can trace retrospective movements even after an account closure, scrutinizing assets like real estate and automobiles.
Social media influencers in Türkiye are subject to withholding tax based on their income, with exemptions for earnings up to 1.9 million Turkish Liras ($65,800) as of this year. To qualify for the exemption, influencers must collect all social media revenues through a Turkish bank.
Anticipating an omnibus bill to be discussed in parliament, the scope of taxation may extend to individuals promoting courses and training products online.
In 2022, nearly 8,500 social media influencer taxpayers paid 91 million liras in taxes on 606 million liras revenue. In 2023, 138 million liras were deducted from over 9,600 taxpayers’ revenue of 921 million liras.
Several influencers who found themselves under the legal spotlight after Polat’s’ case – including Merve Nur Korkut, İleyda Topal, and Tayyar Taylan Öz with his wife, Özlem Öz – continue their posts despite investigations. Others – such as Eylül Öztürk, Feyzanur Başar and İlke Ela Göz – face travel bans and asset seizures upon the request of a public prosecutor’s office in Istanbul.
Sources: Deutsche Welle, Hurriyet, ParaAnaliz
Follow our English language YouTube videos @ REAL TURKEY: https://www.youtube.com/channel/UCKpFJB4GFiNkhmpVZQ_d9Rg
And content at Twitter: @AtillaEng
Facebook: Real Turkey Channel: https://www.facebook.com/realturkeychannel/