Parliament finds corruption in OYAK construction projects

by editor | 4th May 2013 11:06 am

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A parliamentary commission investigating the activities of the Turkish Armed Forces Assistance Center (OYAK) has established that the institution has been highly corrupt in its dealings and cost the Turkish Treasury millions of lira in damages during a residential construction project.

The 130-page report released by a sub-commission of the parliamentary Petition Commission investigating OYAK’s financial dealings states that in 1996 OYAK convinced authorities to issue construction permits for several land plots owned by the Treasury in a valuable area in Ankara, saying they were going to build military barracks. However, they built 1,800 residential apartments, today selling at TL 400,000 each. A shopping mall was also built on the Treasury land and rented to an operator. OYAK’s estimated profit from this operation is TL 500 million.
The commission has found other instances of corruption as well and in its report, it notes that OYAK’s books should be open to audit and review by independent agencies and the Court of Accounts.

The commission decided to inspect OYAK’s past activities following a large number of complaints that reached the commission in early 2012. The sub-commission, chaired by Justice and Development Party (AK Party) Bursa deputy ?smail Ayd?n, worked for a year-and-a-half to discover how OYAK was able to grow to such a major extent from 1997 onwards. The agency was able to build residential projects on plots granted to it by the Treasury or the Ministry of Defense.

The report cites many other examples like Zirvekent. A parcel of land in ?stanbul transferred from the Treasury to OYAK for TL 3.45 million was rented to TÜYAP, a fair and congress center, for $1 million in 1995, at a time when the exchange rate was TL 47,169 to the dollar, further inflating the loss suffered by the Treasury.

The commission says many luxury residential projects, such as Ba?ak?ehir Oyakkent in ?stanbul and Çankaya Zirvekent, were the result of such land transfers from the Treasury.

Renting property leased from the Treasury to others at astronomical rates was another method OYAK used to increase its earnings. For example, the company built a store called OYPA in Çorlu, in Tekirda? province, on land that was meant to be used for a military cemetery. After a while, the store was shut down and OYAK leased the land to a third party for 2.5 percent of the company’s annual turnover, which, according to the parliamentary commission, was 10 times what OYAK paid to the Treasury to lease the same plot.

Noncommissioned officers underrepresented

The report also says that OYAK branches do not have an organization that ensures fairness in representing all ranks. The report found that although most OYAK members are noncommissioned officers (NCOs), almost all executive board members in the past 10 years have been commissioned officers. The report says this injustice mainly stems from the fact that the members of the board of representatives at OYAK are not elected but assigned by the force commands of the Turkish Armed Forces (TSK).

The report called for stricter monitoring of the company in terms of its organizational structure. It said that an OYAK-like agency that offered financial privileges for army members only existed in Greece and other countries with a past of military dictatorships such as Chile, Honduras, Egypt and Pakistan.

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