Turkish opposition leader stokes row with Erdogan over tax haven claims

The leader of Turkey’s main opposition party on Tuesday accused President Recep Tayyip Erdogan’s family of funnelling millions of dollars into offshore bank accounts in the Isle of Man and said that he had the bank records to prove his claims.

Kemal Kilicdaroglu of the Republican People’s Party (CHP), in a speech to party MPs that was broadcast live, read out a list of names of close Erdogan relatives and associates detailing the alleged dates of multi-million-dollar transfers to banks on the British dependency island.

A lawyer for the Erdogan family quickly denied the claims and said the documents were fake. The Turkish president has already accused Kilicdaroglu of lying and launched a lawsuit seeking damages for defamation over similar allegations aired last week.

"All claims made by Kilicdaroglu against my client are completely false, and all documents presented are completely fake," local media quoted Ahmet Ozel as saying.

Waving sheets of paper during his speech, Kilicdaroglu said he was in possession of SWIFT records and bank statements detailing alleged transactions. SWIFT is the system used for international bank transfers.

He did not go into further details during his speech.

But a photograph of a document sent to Middle East Eye by the CHP appeared to show details of a financial transaction involving two Turkish banks and a company in the Isle of Man in which the name of Mustafa Erdogan, the president's brother, had been highlighted as the beneficiary. 

MEE cannot verify the authenticity of the document in the photo.

'The claims have collapsed'

Kilicdaroglu's claims were rejected by Bulent Turan, an MP for Erdogan's Justice and Development Party (AKP). 

“We never took this claim seriously. We watched Kilicdaroglu a short time ago. All the claims are lies. All the documents he cited are commerce-based. The claims have collapsed. He presented them as official documents. Kilicdaroglu should resign,” Turan told pro-government broadcaster ATV.

Kilicdaroglu said a shell company called Bellway Limited had been set up with capital amounting to $1 and registered to an Istanbul address, and then registered with public notaries in both Turkey and the Isle of Man, which is widely considered to be a tax haven.

He went on to list a series of bank transfers to Bellway’s account in the Isle of Man amounting to millions of dollars in 2011 and 2012.

Among those who allegedly transferred money are Erdogan’s son Ahmet Burak Erdogan, his brother-in-law Ziya Ilgen, and Mustafa Erdogan.

Kilicdaroglu cited specific dates for the transfers and the sums he mentioned in his speech which amounted to roughly $14m. No copies of these SWIFT and bank records have been made public.

Documents obtained by Middle East Eye from the Isle of Man Companies Registry list Sidki Ayan and Kasim Oztas as former directors of Bellway Limited, which received an incorporation certificate on 1 August 2011.

Ayan is recorded as having resigned on 11 November 2011. Oztas is recorded as resigning on 11 November 2015.

MEE could not find any references to a company called Bellway in search records of the Istanbul Chamber of Commerce, where Turkish firms are registered.

Kilicdaroglu didn’t expand on who Ayan and Oztas were, but said Erdogan would know them well.

Kilicdaroglu last week promised to deliver proof after Erdogan accused him of lying when he originally aired his accusations.

The Syrian refugees are all either starving or begging. Where did this money go? No one knows

- Kemal Kilicdaroglu

Last week Erdogan launched a lawsuit against Kilicdaroglu in which he is seeking 1.5m Turkish liras ($500,000) in damages for alleged defamation.

Kilicdaroglu, like others MPs, enjoys immunity from prosecution for speeches made in parliament.

Other MPs have had their immunity stripped in the past however. Dozens of MPs from the pro-Kurdish HDP party were stripped of their immunity last year and the party’s co-chair Selahattin Demirtas is still in prison.

A CHP MP, Enis Berberoglu, was also stripped of his immunity and is in prison for involvement in the case revealing alleged weapons shipments by Turkish intelligence to Syrian rebel groups.

The CHP had backed the lifting of parliamentary immunities when the bill was debated and voted on in parliament.   

Spending on Syrian refugees

Kilicdaroglu also demanded accountability for the alleged $30bn that Erdogan claimed to have spent on Syrian refugees since the outbreak of the civil war there.

“Erdogan took the stage at the UN and announced that he has spent $30bn on Syrian refugees. The Syrian refugees are all either starving or begging. Where did this money go? No one knows. Ministers don’t know, 550 MPs don’t know. We demand an answer,” said Kilicdaroglu.

Erdogan had challenged Kilicadroglu to present evidence for his claims, saying he would resign if it was proved that he had transferred money abroad.

Kilicdaroglu hit back on Tuesday, accusing Erdogan of exploiting public sensitivities while doing the opposite.

“You are neither native nor local. This proves it,” said Kilicdaroglu referring to an oft-used description used by the AKP to target opponents.

Cries of “Tayyip resign, Tayyip resign” broke out among CHP MPs after Kilicdaroglu’s allegations.

Prior to Kilicdaroglu’s allegations, pro-government sources had been hinting that he was being supplied with false documentation by Gulenists, who Turkish authorities accuse of similar attempts in the past, in addition to attempting a coup last July.

Gulenists are followers of Fethullah Gulen, a US-based Turkish preacher who is charged with leading a clandestine organisation seeking to topple the government.

Erdogan and his close circle were also the subject of a corruption probe in December 2013. It resulted in four ministers stepping down.

Erdogan and the AKP government said the probe was a Gulenist plot and included fabricated evidence and recordings.

Reza Zarrab, a dual Iranian-Turkish national, was also included in the 2013 corruption probe. Zarrab has now turned state witness in a US case against a senior official from Turkish state lender Halk Bank for allegedly violating US sanctions on Iran.