In the first confirmed case of money laundering exploiting Turkey’s no-questions-asked policy for transferring cash into the country, Ayhan Bora Kaplan, a mafia leader, illegal gun runner and drug trafficker, has admitted to channeling significant sums of money into Turkish banks. This was done with the apparent aim of benefiting from the highly controversial policy of the government of Turkish President Recep Tayyip Erdogan.
When questioned about the bank deposit slips that were confiscated when he was apprehended by the police on September 7 while attempting to leave the country, Kaplan said, “I earned this money by winning it in foreign casinos at various times. I deposited it into [Turkish] banks during the wealth amnesty.”
His statement has been included as evidence in an ongoing criminal investigation and is now a part of the judicial case file. While it is not anticipated that Turkish authorities will take any action regarding such transfers, Kaplan’s statement nonetheless marks the first public record created by a mobster acknowledging how criminals exploited the wealth amnesty policy of the Erdogan government.
Kaplan, a convicted murderer who served more than three years in prison, has evolved into a prominent organized crime figure, transitioning from his earlier role as a low-level street drug dealer. He has gained control over substantial wealth accrued through criminal enterprises, primarily due to his intimate connections with senior government officials, high-ranking police officers and members of the judiciary.
In his statement Kaplan did not disclose the precise amount of money he had funneled into the Turkish financial system through the government’s wealth amnesty measures. However, estimates suggest that this figure likely reaches into the hundreds of millions of dollars, given the substantial wealth he has amassed through various illicit activities, including drug trafficking, gambling, extortion and loansharking. He has also used these illicit revenues to invest in hotels, restaurants and other business ventures.
Over the past decade Turkey, under President Erdogan’s administration, has become a destination where organized crime figures, including internationally recognized and notorious mafia leaders, have found it relatively straightforward to conceal their ill-gotten wealth, often utilizing state banks. There have been credible allegations of senior political leaders enriching themselves through undisclosed commissions associated with these money transfers.
The mechanism employed by the Erdogan government to attract illicit funds as well as legally obtained but undeclared wealth is referred to in Turkish law as the “wealth amnesty,” or “varlık barışı” in Turkish. The wealth amnesty legislation has been passed multiple times in the Turkish Parliament, thanks to President Erdogan’s majority control of the legislative body. The most recent adoption of such an amnesty occurred last year when an amendment to a bill was presented to parliament’s agenda by Erdogan’s ruling Justice and Development Party (AKP).
At the time lawmakers were debating Law No. 7417, which introduced changes to public employment payroll calculations. It had nothing to do with the wealth amnesty.
There was a total lack of transparency and a deliberate attempt to avoid scrutiny regarding the wealth amnesty amendment in the parliamentary process. The bill did not contain any provision for such an amnesty, and no amendments related to it were proposed or discussed in the relevant parliamentary committee before it reached the floor for a vote. The apparent goal was to sidestep any discussion of potential money laundering allegations or controversial aspects of the amendment.
When Law No. 7417 was presented to the General Assembly for a final vote on July 1, 2022, a group of lawmakers led by Erdogan confidant Mustafa Elitaş, a former minister, submitted the amendment. It was quickly approved with little debate about what the amendment actually entailed. It became law when it was signed by President Erdogan four days later and published in the Official Gazette.
According to the amendment, both individuals and entities had until March 31, 2023 to bring in cash, gold or other capital wealth from abroad that was not previously disclosed in Turkey. The amendment does not allow any audit or investigation into such assets under any circumstances, providing total immunity for money launderers, drug traffickers and others who transfer their wealth to Turkey. People who were already under investigation by government auditors will also be able to exploit this amendment if they claim that the wealth under audit was obtained with such transfers.
The government would not impose any taxes on such transfers if the transferred funds were kept in a bank for at least a year. It was clear that the amendment was catering to crime syndicates and allowed them to launder money using Turkey’s banks and its financial system.
This is not the first time the Erdogan government has pushed for loopholes for people who bring cash and assets into the country with no questions asked about how they were earned or where they originated. In 2016 a similar provision was pushed through parliament providing total immunity from both from criminal and administrative investigations into such transfers. The provision, intended to be temporary, has been extended seven times since then.
The government did not reveal how much money was declared as part of the wealth amnesty in 2016 and the following year. The only figures that were publicly available were provided for the years 2018 and 2019 by a lawmaker from the ruling party during a debate in parliament in October 2020 — TL 16 billion and TL 17 billion, respectively. No figure was revealed for the following years.
The lack of transparency and concerns over potential money laundering, as exemplified by the wealth amnesty amendments, have contributed to Turkey’s continued placement on the grey list by the Financial Action Task Force (FATF), the international watchdog for money laundering and terrorist financing. According to a report released by the FATF in July 2023, Turkey has been found to have strategic deficiencies in adhering to the FATF’s recommendations.
The report from FATF called on Turkey to enhance its efforts in conducting more thorough and complex investigations and prosecutions related to money laundering. Additionally, it urged Turkey to intensify its financial investigations in cases involving terrorism. These recommendations reflected the apparent need for Turkey to bolster its anti-money laundering and counterterrorism financing measures to meet international standards and address ongoing concerns related to financial transparency and illicit financial flows, something the Erdogan government is unwilling to do.
The rampant abuse of the Turkish financial system by various criminal elements, such as mafia groups, drug traffickers, organized crime syndicates and terrorist organizations, over the last decade has landed Turkey among countries that were subjected to increased monitoring, which was publicly referred to as being on the “grey list,” in October 2021.
The profile of gang leader Kaplan indeed illustrates how money laundering activities can operate in Turkey under the protection and guidance of senior Turkish officials. It appears that he had established connections with individuals in various positions of power, including the police, politicians, judges and prosecutors, all working to shield him from criminal investigations by law enforcement and the judiciary.
Despite the existence of a warrant to wiretap his phone and conduct surveillance on his movements, insufficient efforts were made by the police to execute these warrants during the tenure of the former interior minister who protected him.
Kaplan’s network involved a network of corrupt officials, including former interior minister Soylu, former Ankara police chief Servet Yılmaz and former Ankara chief public prosecutor Yüksel Kocaman, who obviously collaborated to protect Kaplan from law enforcement agencies and obstruct criminal investigations into him.
Allegations that Kocaman received a luxury villa and an expensive car as gifts from Kaplan in exchange for making criminal complaints go away unmasked the pervasive corruption within the justice system in the country. Kocaman denied allegations of gifts but admitted to meeting the mobster in person during a dinner and dropping the probes against him.
Furthermore, the allegation that both Soylu and Yılmaz enriched themselves through protection money from Kaplan underscores the gravity of the situation as it implies high-ranking officials abused their positions for personal gain, compromising the integrity of law enforcement and public trust in the government.
The fortunes of mafia leader Kaplan seemed to take a turn when Soylu, Yılmaz and Kocaman lost their positions and the Erdogan government faced increasing international pressure to address the issue of organized crime.
Serious concerns have emerged regarding the investigation into Kaplan, highlighting a troubling lack of transparency and accountability within Turkey’s governance. Investigators have intentionally excluded specific names that Kaplan mentioned during a police interrogation. This omission raises significant questions about the investigation’s impartiality and strongly suggests potential control or influence exerted by the Erdogan government. It is obvious that the Erdogan government aims to ensure that the investigation doesn’t scrutinize individuals in the president’s inner circle.
There are several reasons why Kaplan has now become a target, even though the Erdogan government had previously allowed him to operate freely in the Turkish capital, expand his criminal enterprise and corrupt senior government officials, judges, prosecutors and police officers. One key factor is that the Erdogan government is currently facing a pressing need for investment, increased trade and an infusion of fresh capital to support Turkey’s $800 billion economy. To achieve this, there is a necessity to repair strained relations with Western allies and partners, which may involve addressing issues related to organized crime and illicit financial activities within the country.
By initiating action against Kaplan, President Erdogan may seek to send a signal that his government is committed to combating organized crime and money laundering activities, even though the investigation may not delve deeply into the matter. This move could be a tactical attempt to demonstrate a commitment to addressing such issues while avoiding the scrutiny of high-level officials in his close circle.
It is worth remembering that both Soylu and Kocaman have been associated with actions intended to help Erdogan consolidate his power by abusing law enforcement actions and the criminal justice system to target opponents, critics and dissidents. If faced with mounting pressure or serious legal consequences, individuals like Soylu and Kocaman might choose to reveal potentially damaging information, which could further complicate the situation for President Erdogan and his government.
The second reason for targeting Kaplan may indeed be to weaken Soylu by severing his ties to mafia groups that he could potentially use to undermine Erdogan’s rule. Soylu, a highly ambitious politician, possesses the ability to harness the muscle power and substantial financial resources of organized crime syndicates for his political agenda. Persistent rumors in the Turkish capital have suggested that Soylu could take action against Erdogan when the timing is favorable and position himself to succeed him. However, it’s obvious that Erdogan has his own succession plans, which involve handing over the reins of power to his younger son, Bilal, thereby leaving no room for Soylu in his political will.
The third reason could be to send a message to the conservative support base within the ruling party who have grown uneasy about the escalating violence on the streets and the entrenched control of mafia groups and organized crime figures in Turkey. Erdogan may aim to quell internal criticism by taking action against Kaplan and his associates, at least temporarily. This action would serve as a demonstration that his government is committed to combating such criminal enterprises and addressing concerns about public safety and national security.
In the final analysis there may be limited hope for substantial and lasting action against mafia groups in Turkey, considering their deep entrenchment within politics, law enforcement and the judiciary. Their control over vast amounts of illicit funds can buy them protection and potentially corrupt government officials. Crucially, the lack of a strong political will to address this issue is a significant obstacle, as there may be vested interests among those in power, including President Erdogan and his associates, who benefit from the presence of these criminal enterprises.
Indeed, achieving meaningful change in addressing the challenges posed by mafia groups and organized crime in Turkey would necessitate a significant shift in political priorities, a firm commitment to transparency and accountability, and a determined effort to combat corruption throughout all levels of government. However, President Erdogan has no intention of taking such actions, posing a formidable barrier to reform in Turkey.
The absence of political will to tackle these issues will perpetuate the status quo, allowing criminal enterprises to continue operating with near total impunity.
It appears that the recent action against the mobster may indeed be seen as a superficial or symbolic gesture, serving the short-term political goals of President Erdogan and his associates. However, the process, including the statements made by Kaplan and the flow of information, has the potential to shed light on aspects of the government that have previously been concealed. This information could uncover more concerning details about the relationship between organized crime and elements within the Erdogan government and further expose the “dirty side” of the government.