Turkey hides the assets of its citizens living in Europe so they can unfairly benefit from social assistance

Levent Kenez/Stockholm

Abdullah Eren, the head of Turkey’s diaspora agency, the Presidency for Turks Abroad and Related Communities (YTB), told a meeting of the parliament’s foreign relations committee on April 7 that they had taken steps to prevent the assets of citizens living abroad from being detected by the countries in which they live.

European countries require information about assets, income and bank deposits belonging to Turkish citizens living in Europe to be accessible to them in order to prevent tax evasion and unfair welfare benefits.

Abdullah Eren

It is believed that a significant number of Turkish citizens living in Europe receive social assistance, even if they have several houses in Turkey, a large sum of money in Turkish banks or income from Turkey.

In his speech to the committee, Eren said that they had developed mechanisms to prevent the assets of Turkish citizens in Turkey from being scrutinized by the municipalities where they are registered in Europe. For example, he said that through a two-step verification process, foreign municipalities are now unable to access property deed information, which was previously available with a Turkish citizenship number. In many European countries, social assistance is provided by municipalities. To receive assistance, your income and asset information must be fully and accurately reported.

There is another measure that Eren did not mention but Turkey implemented. Turkey passed the Personal Data Protection Law in 2016 after receiving complaints from citizens abroad. According to this law, Turkish citizens can hide their assets if they wish. When applying to the Social Security Institution (SGK), their deeds and received SGK pensions can be hidden within 28 days, so that this information is not disclosed to third parties, including governments and foreign municipalities.

Transcript of Eren’s speech in parliament:

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However, the situation is different when it comes to citizens’ funds in the bank. Turkey became a party to the “Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information” in 2019. It started sharing information with other countries in 2021. The objectives of the agreement include transparency as well as the prevention of money laundering and terrorist financing.

With the agreement, the information of Turkish citizens residing in other countries must be transferred to the Ministry of Finance through the banks and then to the authority of the country concerned. If the recipient country receiving the information determines that the person residing within its borders has not declared income in Turkey, it may impose a penalty for tax evasion.

For a long time, Turkey refrained from implementing the agreement, saying its infrastructure was not suitable for sharing information. However, in 2021, Turkey finally started sharing 2019 financial records with Norway, Latvia, England, Denmark, Finland, Sweden, Italy, Canada and Australia, adding Germany, Austria, Belgium and the Netherlands, all heavily populated by Turks.

As Turkey begins to share information, pro-government media have published articles that bank information is shared with other countries based on the address of the account holder and that they can prevent such sharing if the address on the bank accounts is changed in Turkey, in an effort to calm expatriate anger at the government for enforcing the deal. It appears that while Turkey, unable to withstand the pressure of being blacklisted abroad, has signed an international agreement to prevent financial abuse, it is also exploring ways to make the agreement dysfunctional at home.

Utku Çakırözer, MP and member of the Parliamentary Foreign Relations Committee, told Eren that Turkey started implementing the agreement without adequately informing some 7 million Turkish citizens living abroad and said that the government had not provided them with legal assistance. Eren said they haven’t received any complaints so far.

Eren also gave a presentation on YTB’s business, especially in Europe and the Balkans, during the committee meeting. Nordic Monitor previously reported how the National Intelligence Organization (MIT) recruited spies using non-governmental organizations including the YTB and the Turkish Cooperation and Coordination Agency (TİKA).

Text of the Multilateral Competent Authority Agreement on the Automatic Exchange of Financial Account Information:

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Mary I. Bruner