PEER BASED ASSESSMENT MISSION TO
REFORM OF THE JUDICIARY AND ANTI-
FIGHT AGAINST CORRUPTION AND ECONOMIC CRIME INCLUDING MONEY LAUNDERING AND THE FINANCING OF
17 –21 NOVEMBER 2008
Table of contents
Executive summary 4
1. Introduction 6
2. Policy and domestic institutions 6
2.1 National Strategy to Fight Corruption 6
2.2 Turkish Grand National Assembly (TGNA) 7
2.3 Commission for Enhancing Transparency and Good Governance 7
2.4 Prime Ministry Board of Ethics 7
2.5 Constitutional Court 8
2.6 Ministry of Justice 9
2.7 Public Prosecutors Office 9
2.8 Law Enforcement Agencies 10
2.9 Ministerial Inspectorates 11
2.10 Turkish Court of Accounts 12
2.11 Audit 12
2.12 Public Procurement Agency 13
2.13 Board of Review of the Access to Information 13
2.14 Civil Society 14
3. Domestic Legal Framework 14
4. Fight against Economic Crime including Money Laundering and the Financing 16 of Terrorism
4.1 Role of MASAK 16
4.2 International co-operation 18
4.3 Countering the Financing of Terrorism 18
5. Conclusion 19
6. Summary of Recommendations 19
Annex A Relevant Legislation 21
Annex B International Instruments 23
The expert was tasked by the European Commission to assess anti-corruption and anti money laundering measures taken by the Turkish authorities in the fight against corruption and economic and financial crime in the public sector. The assessment reviewed the anti-corruption capacities of the public sector institutions responsible for the prevention and counteraction of corruption in Turkey. Meetings were held with the Public Prosecutors Office; the Prime Ministry Inspection Board; the Ministry of Interior; the Ministry of Finance; the Under-secretariat of Customs; the Prime Ministry Board of Ethics; the Turkish National Police; the General Command of Gendarmerie; the Public Procurement Agency; the Ministry of Justice; the Board of Review and Access to Information; the Turkish Court of Accounts; the Constitutional Court and with representatives from a local ‘think tank’ to assess a civil society perspective on the fight against corruption. The purpose was to assess the current capacity and propose recommendations. The process involved an analysis of each administrations anti-corruption activity. The expert met with the Financial Crimes Investigation Board (MASAK) to assess their capacity with respect to combating money laundering including the financing of terrorism.
Prior to the visit the expert was informed that the Turkish Authorities did not have a National Anti-corruption Strategy although an action plan ‘Increasing Transparency and Enhancing
Transparency in the Public Sector’ had been adopted in 2002.
During the visit the expert was provided with a draft National Anti-corruption Strategy [NACS]. NACS needs to be further developed involving all public institutions and civil society. To be fully effective NACS will require Ministerial support with a single body responsible for coordinating activities. The Ministerial Commission established to coordinate the implementation of the 2002 Action Plan and the Prime Ministry Inspection Board (PMIB) providing technical support and secretariat can fulfil these roles.
The Turkish National Police is responsible for policing and enforcing security within
metropolitan areas. The General Command of Gendarmerie is subordinated to the General Staff for military, training and education issues and to the Ministry of Interior for policing and enforcing security outside of the municipalities. Both the TNP and the Jandarma have an Anti-Smuggling and Organised Crime Department which have the responsibility for investigating corruption. Both agencies have access to specialist investigation techniques such as wiretapping, surveillance and undercover officers which can be deployed in corruption investigations with judicial authority. The Under-Secretariat of Customs is responsible for the management and control of customs procedures at international border gates. The Customs Investigation Board is responsible for investigating corruption, smuggling and financial crimes. The Financial Crimes Investigation Board (MASAK)
subordinated to the Ministry of Finance is both a financial intelligence unit and regulatory-
supervisory authority regarding AML/CFT.MASAK has the power to collect data, to receive suspicious transaction reports, to analyze and evaluate them in the scope of prevention of laundering the proceeds of crime and terrorist financing.
The conduct of criminal investigations is the responsibility of the public prosecutors. At present there is relatively little knowledge and experience amongst public prosecutors capable of effectively processing corruption, money laundering offences and the proceeds of crime.
The expert was informed that interagency co-operation is good and that joint operational and training activities have taken place.
All key ministries and subordinated agencies have inspectorates which vary in complement dependent upon the number of personnel within the administration. Recruitment of inspectors is merit based- potential inspectors are required to successfully conclude a 3-year learning period as an assistant inspector. The Prime Ministry Inspection Board is directly subordinated to the Prime Minister’s Office and has a broad scope of jurisdiction and regulatory and
coordination duties concerning the inspection system. The Ministry of Interior Civil Inspection Board not only investigates allegations and complaints within the Ministry but is also empowered to control and investigate districts and provincial units headed by local governors, TNP, the Jandarma and the Coast Guard. The Board of Financial Inspection not only inspects the central and provincial units of the Ministry of Finance it also has a cross cutting role in that it audits transactions in respect of the acquisition, management, disposal of movable and immovable public assets in the public administrations.
The Turkish Court of Accounts is a Supreme Audit Institution equipped with judicial power and not subject to administrative or political supervision responsible for auditing the revenues, expenditures and property of public administrations on behalf of Parliament. Each public sector institution will have an internal audit function following the implementation of the Internal Audit Strategy 2008-2010. Over 500 auditors have been trained in accordance with the Public Financial Management and Control Law. External audit (currently financial only) on public expenditure is exercised by the Turkish Court of Accounts although the State Supervisory Council of the Office of the Presidency is also empowered to conduct audits in all public institutions.
The Turkish authorities need to ensure that legislation and the international instruments are implemented effectively-the creation of the national coordination group within the Ministry
of Justice is a positive step. The legal framework to fighting corruption and disciplinary procedures are fragmented. Consideration needs to be given to drafting either an Anti-corruption law or an Anti-corruption handbook collating and compiling all the relevant laws, offences and procedures.
The new Penal Code criminalised money laundering by making all crimes which carry a custodial sentence exceeding 12 months a money laundering predicate offence. The offence of terrorist financing was established as a separate offence by Law 5532 of 29 June 2006 which came into force on 18 July 2006. Measures have also been introduced to seize and confiscate the proceeds of crime. MASAK has developed an IT system which will introduce timely and reliable processing of STR information with powerful analytical tools. The Customs Administration has been granted new powers to impose restrictions on the importation and exportation of currency. The Co-ordination Board for Combating Financial Crimes established under Law 5549 comprises members from the relevant institutions responsible for combating laundering the proceeds of crime and provides high level coordination among these institutions. The Board is responsible for evaluating draft legislation and proposals and determining policies concerning implementation.
Turkey has signed and ratified all the relevant international treaties and conventions and the FATF nine special recommendations on terrorist financing have been implemented.
The expert was tasked by the European Commission to assess anti-corruption and anti money laundering measures taken by the Turkish authorities in the fight against corruption and economic and financial crime in the public sector.
Meetings arranged by the Turkish Authorities were held with the Public Prosecutors Office [PPO], the Prime Ministry Inspection Board [PMIB], the Ministry of Interior [MoI], the Ministry of Finance [MoF], the Under-secretariat of Customs, the Prime Ministry Board of Ethics [PMBE], the Financial Crimes Investigation Board [MASAK], the Turkish National Police [TNP], the General Command of Gendarmerie [Jandarma], and the Public Procurement Agency [PPA].
Meetings were also held with the Ministry of Justice [MoJ] with respect to developments in legislation, the Board of Review and Access to Information with respect to institutional information access by the public, the Turkish Court of Accounts [TCA] with respect to external audit and the Constitutional Court with respect to Political Party Financing and Parliamentary Immunity. The expert also met with representatives from a local ‘think tank’ to assess a civil society perspective on the fight against corruption. The expert was accompanied by Ms Anna-Maria Karjalainen from the European Commission, Mr Harun Tuncer and Ms Gamze Kosekhaya from the EC Delegation in Ankara.
The purpose was to assess the current capacity, identify any gaps in the current framework and propose recommendations. The process involved an analysis of each administration’s
In order to draw together the maximum amount of information and to ensure that a balanced picture was obtained, the expert decided on a methodology which would include group interviews, site visits and research of documents, working papers, regulations and procedures. This methodology was designed to give an all-round perspective of the measures taken in the administrations to combat corruption. Information was provided to the expert at meetings and through research of documents provided prior to and during this mission. As the duration of the mission was 4 full working days the expert offers a general overview of the framework.
Proposed recommendations take account of the international conventions and the previous missions by the Group of States against Corruption (GRECO), the Organisation for Economic Co-operation and Development (OECD) and the Financial Action Task Force (FATF).
The assessment takes note of the positive steps already taken by the administrations and seeks to build on these achievements.
2. Policy And Domestic Institutions
2.1. National Strategy to Fight Corruption
During the visit the expert was provided with a draft National Anti-corruption Strategy [NACS]. The NACS needs to be further developed involving all public institutions and civil society. To be fully effective the NACS will require Ministerial support with a single body
responsible for coordinating activities. The Ministerial Commission established to coordinate the implementation of the 2002 Action Plan and the Prime Ministry Inspection Board (PMIB) providing technical support and secretariat can fulfil these roles. An overarching National Anti-corruption Strategy is required to provide a coherent integrated framework.
Recommendation 1: Establish a National Anti-corruption Strategy and action plan in cooperation with civil society and related public sector institutions with SMART objectives including performance indicators and individual/institutional responsibilities.
2.2. Turkish Grand National Assembly (TGNA)
TGNA may establish special inspection and investigation committees on different issues including corruption. It may second personnel from the different institutions commonly delegated as experts. It has previously executed inquiries in relation to allegations made against a former Prime Minister and seven former ministers. There is no permanent Parliamentary Ethics/Anticorruption Commission.
Recommendation 2: Establish a permanent Parliamentary Commission to deal with
complaints/allegations made against Parliamentarians and develop a code of conduct for MPs and members of Council of Ministers.
2.3. Commission for Enhancing Transparency and Good Governance
A Ministerial Commission was established to coordinate the implementation of the 2002 Action Plan Enhancing Transparency and Good Governance in the Public Sector. The Prime
Ministry Inspection Board (PMIB) was assigned to provide technical support and secretariat. The Commission prepared a monitoring report on anti-corruption policies and on legislative and administrative requirements to combat corruption. One of the recommendations of the Commission was the establishment of the Prime Ministry Board of Ethics. Although the Commission has not been dissolved formally, meetings are few and far between. Successful implementation of the NACS requires the support of the Prime Minister with Ministerial oversight.
Recommendation 3: Enhance the role of the Ministerial Commission with representation
from all the public sector institutions to develop the NACS and develop anti-corruption policy, reporting to the Council of Ministers.
2.4. Prime Ministry Board of Ethics
The Prime Ministry Board of Ethics also known as the ‘Ethics Council’ was established by Law 5176 in 2004. The Ethics Council is composed of retired persons, such as former ambassadors, judges and professors. Its overall objective is to create ethical standards for the executive branch of the public sector, at central as well as local level. A set of ethical guidelines in the public sector in the form of an Ethical Code, drafted by the Council, was adopted by the Prime Ministry in April 2005. The Ethics Council has no authority to investigate disciplinary matters or to use disciplinary measures. The Council can, however, investigate violations of the Ethics Code and its findings may be published in the Official
Gazette by the Prime Ministry. The Ethical Code was designed to update the Law on Civil Servants and other laws which outline official conduct and responsibilities.
It has introduced conduct responsibilities in relation to conflicts of interest, receiving gifts and misuse of official resources. It also advocates the creation of an Ethics Commission in every public sector institution to develop ethical culture. Disciplinary procedures for civil servants, judiciary, academics, and military are detailed in their respective personnel laws. All disciplinary rules require a sanction.
Recommendation 4: Develop a disciplinary code to outline and clarify the roles and responsibilities of the Ethics Council and Disciplinary Commissions. The code should define ethical and disciplinary offences. Because of the specialisms within the public sector each administration should develop its own Code of Conduct to include:
Management responsibilities; Relations with the public; Rules for acceptance of gifts and rewards; Conflicts of interest-activities requiring permission or need to be reported; Reporting involvement in criminal proceedings; Confidentiality of official information; Security of information and assets; Use of official property including vehicles; Health at work- drug/ alcohol misuse; cross referral to or inclusion of the disciplinary process; definition and examples of misconduct and serious misconduct; details of potential sanctions.
2.5. Constitutional Court
The Turkish Constitutional Court was established in 1962 after the founders of the 1961 constitution agreed on the necessity of a special high court to review the constitutionality of laws. The Turkish Constitutional Court’s task is to ensure that all institutions of the state abide by the Constitution. Access to the Constitutional Court can be made in the following circumstances;
1. Action for annulment (abstract review of norms)
2. Contention of unconstitutionality(concrete review of norms)
3. Application for the dissolution of Political Parties
4. Application for warning of Political Parties
5. Application for trial of statesmen before the High Court Of Justice
Applications have averaged over 130 per year over the last 6 years-details are posted on the Constitutional Court website. The Turkish Constitutional Court is also responsible for auditing the finances of Political Parties and applications for waiving Parliamentary immunity. Since 1964 immunity has been waived in respect of 36 MPs and 6 Senators. Immunity does not apply if a Parliamentarian has broken the law, committed a violation with respect to the integrity of the state or has breached basic rights. The privilege of immunity only applies in respect of Parliamentary duties and is revoked when an MP leaves Parliament.
Provisions for auditing the finances of Political Parties are made in the Law for the Establishment of The Constitutional Court and the Law on Political Party Financing. Results of the audits published on official Gazette, which is available on internet for free of charge. MP asset declarations are lodged with the Speakers Office.
A new Law on Political Party Financing has been drafted which introduces transparency in relation to donors and the amount of donations.
Recommendation 5: Introduce the new legislation and extend the scope to include election campaign financing including independent candidates.
Recommendation 6: The Constitutional Court and the Court of Accounts should also have
the capacity to audit election campaign financing.
Recommendation 7: To ensure transparency and provide assurance to the general public; adopt criteria for invoking/revoking parliamentary immunity
2.6. Ministry of Justice
The expert met with representatives from the MoJ General Directorates for Legislation, International Law and Foreign Relations and Penal Affairs to discuss anti-corruption legislation, international cooperation in the fight against corruption, legal approximation and alignment with international instruments. The expert was informed that provisions for prosecuting corruption offences exist in Law 3628-Declaration of Assets and the Fight against Bribery and Corruption-investigations are executed in accordance with article 17 of the law. Law 5237-Turkish Penal Code and the Law 5411 on Banking also make provision-investigations and prosecutions are executed pursuant to the Law 5271-Penal Procedure Code.
With respect to the implementation of GRECO and OECD Anti-bribery convention recommendations-national coordination groups have been established which comprises representatives from the relevant institutions. The group monitors the activities on the implementation of the recommendations and discuss necessary measures.
MoJ has assumed a coordination responsibility in respect of both activities and compliance measures have been included in the Draft National Programme to Adopt the Acquis.
Foreign bribery topics have been included in training programmes, a booklet and handbook have been produced and a special website has been designed.
A law to amend the Penal Code and Code of Misdemeanours has been drafted and submitted to the Parliament to ensure alignment with international conventions and implement the recommendations of GRECO, OECD (Articles 13, 60 & 254), and FATF (Articles 165 & 282). Moreover, the draft envisages assigning the Prime Ministry Inspection Board as AFCOS, which is an EU requirement. Adoption of this law would further strengthen the legislative framework and coordination.
2.7. Public Prosecutors Office
The conduct of criminal investigations is the responsibility of the public prosecutors. Under the Codified System of Law (sometimes known as Napoleonic System of Law), Criminal Procedure Code envisages full direction and supervision of public prosecutor in every step of a criminal investigation. In practice under the instruction of public prosecutor law enforcement officers gather information and intelligence and produce a file, then submit it to the public prosecutor’s office for consideration. When a file is received by the public
prosecutor he or she will take full control and it is unlikely that an investigator will see the outcome. A common complaint from investigators is the lack of feedback, particularly with respect to cases which have concluded in acquittals. Investigators need to know if the acquittals resulted from their incompetence or lack of training and take steps to address the issues.
There is a Public Prosecutors Office in the 81 provinces and sub districts. There are no specialist anti-corruption units but corruption will generally be dealt with by the criminal prosecution unit.
The cornerstone to the effective implementation of all the legislation and regulations is a professional and well co-ordinated public prosecutor’s office. There is no prosecution
authority in overall control and co-ordination of all the prosecutor’s offices. There are no
statistics in relation to corruption cases, prosecutions and convictions.
At present there is relatively little knowledge and experience amongst public prosecutors capable of effectively processing money laundering offences and the proceeds derived from crime.
Whilst the judiciary (judges and prosecutors) are independent of the executive constitutionally, the High Council of Judges and Prosecutors, the supreme governing body of the judiciary in Turkey, is not wholly independent. It does not have its own secretariat, budget or premises – it is currently housed within the Ministry of Justice. The judicial inspectorate which is responsible for evaluating the performance of the prosecutors is attached to the Ministry rather than the High Council.
Recommendation 8: Establish a coordination body for Public Prosecutors whose role would include; creating a feedback mechanism to investigators, ensure that specialist training such as anti-corruption and money laundering has been provided, collate statistics on corruption cases, establish specialist units to process anti-corruption and money laundering cases and continue to develop knowledge and expertise in corruption and financial matters.
Recommendation 9: Consider a structure that guarantees that prosecutors dealing with these kinds of prosecutions [corruption and money laundering] are provided with adequate training/protection against these specific risks their jobs entail.
2.8. Law Enforcement
There are a number of enforcement agencies operating within Turkey. The Turkish National
Police (TNP) comes under the General Directorate of Security in the Ministry of Interior and is responsible for policing and enforcing security within metropolitan areas. The General
Command of Gendarmerie (Jandarma) is subordinated to the General Staff for military,
training and education issues and to the Ministry of Interior for policing and enforcing security outside of the municipalities.
Both the TNP and the Jandarma have an Anti-Smuggling and Organised Crime Department. They have access to specialist investigation techniques such as wiretapping, surveillance and undercover officers which can be deployed in corruption investigations with judicial authority. They both have duties and responsibilities to investigate organised crime and corruption.
The Under-Secretariat of Customs (Customs) is responsible for the management and control
of customs procedures at international border gates. It is led by an Under-Secretary directly
responsible to the Prime Ministry. The Customs Investigation Board, who are ‘inspector’