More Turks have been targeted by US federal prosecutors in money laundering and fraud schemes in recent years as US government agencies uncovered illegal networks that extended to Turkey, with some cases apparently linked to the highest echelon of Turkish leadership.
In the latest example a 50-year-old Turkish national named İbrahim Aksakal was sentenced on March 8 to 27 months in prison for conspiring to commit health care and wire fraud and ordered to pay more than $1 million in restitution.
Aksakal had operated a so-called “birth tourism” scheme in New York state between 2017 and 2020, facilitating the fraudulent entry of pregnant Turkish women to the US on tourist or business visas to give birth so that their children would obtain birthright citizenship and medical benefits.
Indictment against Ibrahim Aksakal:Ibrahim_aksakal_.indictment
Aksakal and co-conspirators Enes Burak Çakıroğlu and Hatun Kaplan, also Turkish nationals, advertised a birth tourism scheme on Turkish-language Facebook pages. They charged pregnant women thousands of dollars, telling them to conceal their pregnancies when they applied for visas and to not to reveal the true reason for their visit to the US and helping them stay in designated houses before and after birth.
On behalf of 117 Turkish women, the group fraudulently filed for benefits and obtained a $2.1 million disbursement from Medicaid, a US government health care program providing benefits to individuals who lack adequate resources to pay for medical care. Two US citizens, Fiordalisa Marte and Edgar Rodriguez, helped the gang process the paperwork for the scheme.
According to the indictment filed by US attorneys on December 2, 2020 in New York, Aksakal and his gang were charged with visa, wire and health care fraud as well as money laundering. Faced with a possible maximum 20-year sentence, Aksakal cut a deal with prosecutors by pleading guilty to health care and wire fraud charges on October 1, 2021 and was sentenced a year later to 27 months in prison.
In another case involving a Turkish citizen, a hacker identified as İzzet Mert Özek was indicted on September 29, 2021 by a special grand jury in Chicago for orchestrating a cyber attack in 2017 against an American hospitality firm, preventing customers from conducting business on the company’s website such as booking rooms. The website faced a distributed denial-of-service (DDoS) attack by Özek, who used the WireX botnet, which consisted of compromised Google Android devices, to direct large amounts of network traffic to the company’s website.
An arrest warrant was issued for Özek, 32, who faces up to 10 years in prison if convicted and still remains at large in Turkey.
According to records of the United Nations’ World Intellectual Property Organization (WIPO), Özek was also involved in a scheme to create a fake website to divert traffic from the website of a major Turkish communications firm. WIPA ruled to transfer the fake website to the legitimate business owner and concluded that Özek registered the website in bad faith and intended to collect private data from clients.
Özek had registered dozens of fake websites including porn and pirated movie sites in his name to run hacking schemes and collect private data from unsuspecting users.
Indictment against Izzet Mert Özek:Izzet_Mert_Ozek_ indictment
In another case involving a Turk, US attorneys in Pennsylvania indicted Hakan Kantar on charges of committing mail and wire fraud because he falsely represented that he was a US citizen when he applied for and received a COVID-19 Economic Injury Disaster Loan from the Small Business Administration and unemployment benefits from the Commonwealth of Pennsylvania. The charges carry a maximum sentence of 60 years in prison, a fine of $2,000,000, or both. The actual sentencing will depend on the seriousness of the crime and if Kantar has a criminal record.
On July 21, 2021 Arif Ugur, also a Turkish citizen, was indicted in Massachusetts for wire fraud and illegally exporting defense articles to Turkey. Ugur set up a business under the name of the Anatolia Group Limited Partnership in the state in 2015 and acquired several contracts to supply the Department of Defense (DoD) with a variety of machine parts and hardware intended for use by the US military.
Criminal complaint filed by US Homeland Security against Arif Uğur :Arif Ugur _June 22, 2021 Criminal Complaint Affidavit
According to the contract terms, he was supposed to manufacture parts in the US, but instead contracted a firm in Turkey to produce them and ship them to DoD as if they had actually been made in the US. He transferred the technical data to clients in Turkey in violation of US federal law and provided foreign nationals access to the department’s restricted site for online library and technical specifications.
What is more, some of the parts delivered to Defense were substandard and unsuitable for use by the military. He faces up to 25 years in prison on combined charges as well as fines if he is convicted.
Another Turkish citizen, Sezgin Baran Korkmaz, a con-man businessman who defrauded US taxpayers of more than $133 million, was indicted by a federal grand jury in Salt Lake City, Utah, on April 28, 2021. He had worked closely with Turkish President Recep Tayyip Erdoğan, whose government helped him acquire multiple firms in Turkey under illegal schemes.
Korkmaz was detained in Austria on June 19, 2021 at the request of the US on money laundering and wire fraud charges. Austria’s Federal Ministry of Justice is set to decide to which country Korkmaz will be extradited to after legal challenges are sorted out in the courts. In January 2022 an Austrian court cleared the way for his extradition to the US on fraud and perjury charges while rejecting the money laundering charge. In March Austrian prosecutors appealed the decision by arguing that the court made an error in rejecting the money laundering charges and that all three charges need to be approved before his handover to the US to face trial. In the meantime, the Erdoğan government worked hard to prevent his extradition to the US but has thus far failed.
Korkmaz ran a sophisticated scheme in cooperation with US nationals Jacob Kingston, Isaiah Kingston and Levon Termendzhyan to defraud the US Treasury by filing false claims for over $1 billion in refundable renewable fuel tax credits for the production and sale of biodiesel by their company, Washakie Renewable Energy LLC, in Plymouth, Utah. He faces up to 25 years in prison if convicted.
There have been a few cases that involved Turkish citizens in Iran sanctions busting schemes with the help of the Erdoğan government. In one case Reşit Tavan, the owner of several shell companies in Turkey, was indicted on June 27, 2017 by US federal prosecutors for conspiring to defraud the US and smuggle American-made products to Iran. The indictment alleged that marine goods such as outboard motors, generators and propulsion systems that were manufactured in Wisconsin were shipped first to Turkey and then to Iran without the knowledge of the manufacturers and without a license from the US government.
The US issued an international arrest warrant for Tavan, but the Erdoğan government refused to execute the warrant. He was arrested on June 8, 2017 when he was going through customs in Romania and unsuccessfully fought extradition. The Turkish Embassy in Bucharest lobbied to get him back to safety in Turkey, helped him hire a former justice minister of Romania as his defense attorney and even managed to get a ruling against extradition in the court of first instance. But the appeals court overruled the judgment and cleared the way for his extradition to the US. On December 11, 2017 he was formally arrested during his arraignment in federal court in Milwaukee after Romanian authorities turned him over to the US, balking at the Turkish government’s request.
On April 2, 2019, faced with overwhelming evidence and the prospect of a long prison sentence, Tavan cut a deal with federal prosecutors and pleaded guilty to conspiracy to violate US laws, saving himself from the lengthy sentence he would most likely receive on additional charges. The Federal District Court in Milwaukee sentenced him to 28 months’ imprisonment on August 29, 2019. US District Judge Pamela Pepper ruled to release and deport him to Turkey given the fact that he had already spent 20 months in the Waukesha County Jail. He is now back in business in Turkey.
Tavan is not the only operative that was used by Iran and who enjoyed the permissive environment provided by the Turkish government when it comes to sanctions busting schemes and Iran. A damning revelation was made when a corruption case involving Turkish Iranian national Reza Zarrab, who bribed senior government officials including cabinet ministers and cultivated personal ties with Erdoğan, was made public on December 17, 2013. Dozens of suspects including Zarrab were detained and later arrested for violating several Turkish laws.
Erdoğan, who was incriminated in the probe, stepped in to derail the prosecution and helped release all the suspects after he orchestrated the removal of the lead prosecutors and investigators in the case. All suspects including Zarrab were later acquitted by new judges who were brought in to oversee the case by the Erdoğan government.
However, Zarrab was arrested by the FBI in Miami in 2016 and charged by the US Attorney for the Southern District of New York with engaging in hundreds of millions of dollars’ worth of transactions on behalf of the Iranian government, money laundering and bank fraud. He made a plea deal with prosecutors and cooperated in a US federal case that exposed the role of Erdoğan, who had instructed Turkish state banks to participate in the multi-billion dollar scheme in exchange for kickbacks.
At the end of the trial, Mehmet Hakan Atilla, the deputy general manager of state lender Halkbank, was convicted and served time before returning to Turkey. The co-conspirators who were indicted by the US federal prosecutors including former Economy Minister of Turkey in the Erdoğan cabinet remain beyond reach.
Another operative of Turkish President Erdoğan faced the long arm of the US justice system when his secret ties were exposed during a federal investigation. Kamil Ekim Alptekin, a Turkish national, and his associate Bijan Rafiekian were indicted, tried and convicted in the US for acting covertly as agents of the Turkish government in the US without disclosing that relationship to the US government.
The US Fourth Circuit Court upheld the convictions on March 18, 2021.
The plot included using the services of the Flynn Intel Group (FIG), a company founded by Rafiekian and retired Gen. Michael Flynn, to publicly and privately influence US politicians and public opinion against US resident Fethullah Gülen, a fierce critic of President Erdoğan. Alptekin funded secret work in the US through a shell company he established in the Netherlands under orders from the Turkish government.
Alptekin remains as a fugitive in Turkey and is protected by the Erdoğan government.