Financial Crime World

Financial Crime Definition in Turkey

Turkey’s strategic location has made it a hub for financial crimes such as money laundering, making it essential to understand the country’s stance on anti-money laundering (AML) and its regulatory framework. In this article, we will explore what constitutes financial crime definition in Turkey.

Anti-Money Laundering in Turkey

Turkey has implemented strict AML laws and regulations to combat financial crimes, aligning with global standards. The country is determined to protect its financial system from money laundering and terrorism financing.

Core AML Laws in Turkey

Several laws outline the responsibilities of financial institutions, supervisors, and reportable entities in detecting and avoiding money laundering. These laws include:

  • Law No. 5549 (2006): Outlines the responsibilities of financial institutions and supervisors.
  • Law No. 5237: Criminalizes various types of money laundering.
  • Law No. 6493: Covers payment services and e-money institutions, setting out their AML obligations.
  • Law No. 6362: Regulates capital markets activities and includes provisions for fighting money laundering in securities.

AML Regulatory Authority in Turkey

The Finance and Treasury Ministry plays a crucial role in coordinating anti-money laundering efforts, supervising the Financial Crimes Investigation Board (MASAK). MASAK is responsible for preventing and investigating money laundering and terrorism financing.

Regulatory agencies such as:

  • Banking Regulation and Supervision Agency (BDDK)
  • Capital Markets Board (SPK)

monitor financial institutions’ AML compliance in their sectors, ensuring adherence to:

  • Customer due diligence
  • Transactions monitoring
  • Reporting obligations

Turkey’s Cooperation with International Bodies

Turkey’s cooperation with international bodies, including:

  • FATF
  • UN
  • EU

demonstrates its commitment to global anti-money laundering efforts. Through mutual evaluations and adherence to international standards, Turkey strengthens its ability to combat money laundering effectively.

Money Laundering Exposure in Turkey

Several sectors pose vulnerabilities to money laundering, including:

  • Trade-Based Money Laundering (TBML): Illicit funds hide within legitimate trade transactions.
  • Informal financial systems: Remittance networks and cash-intensive businesses that can be exploited for money laundering.
  • Real estate sector: Offers opportunities for legitimizing illicit funds through high-value property transactions.
  • Corruption and political instability: Create an environment conducive to money laundering.
  • Virtual currencies and online transactions: Offer anonymity and complexity for money launderers.
  • Cross-border movements of illicit funds: Facilitated by Turkey’s proximity to conflict zones and regions with weak AML enforcement.
  • Terrorist financing: Poses a concern due to the country’s proximity to conflict zones and refugee flows.