Efe Kerem Sözeri
Nov 06 2017

Paradise lost: Turkish PM's family kept shipping business secret in Malta

THE HAGUE (UPDATES YILDIRIM'S RESPONSE) - Turkish Prime Minister Binali Yıldırım's sons, Erkam and Bülent Yıldırım, who made their fortune in the shipping industry, own two more companies in Malta, according to documents obtained by the International Consortium of Investigative Journalists (ICIJ).

The Yıldırım brothers are the sole shareholders of Hawke Bay Marine Co. Ltd, set up in April 2004, and Black Eagle Marine Co. Ltd, set up in January 2007. According to Maltese records, both companies are still operational and Erkam Yıldırım is the majority shareholder and the director of both.

The following two-page document, obtained by the ICIJ from the Malta Corporate Registry website, shows the ownership profile of Hawke Bay Marine Co. Ltd between Erkam and Bülent Yıldırım.

Printscreen from the Malta Corporate Registry showing that Erkam and Bulent Yildirim are sole shareholders of Hawke Bay Marine Co. Ltd. Document obtained from the Malta Corporate Registry (https://registry.mfsa.com.mt). Contributed by: Delphine Reuter, International Consortium of Investigative Journalists
Printscreen from the Malta Corporate Registry showing that Erkam and Bulent Yildirim are sole shareholders of Hawke Bay Marine Co. Ltd. Document obtained from the Malta Corporate Registry (https://registry.mfsa.com.mt). Contributor: Delphine Reuter/ICIJ
Printscreen from the Malta Corporate Registry showing that Erkam and Bulent Yildirim are sole shareholders of Hawke Bay Marine Co. Ltd. Document obtained from the Malta Corporate Registry (https://registry.mfsa.com.mt). Contributed by: Delphine Reuter, International Consortium of Investigative Journalists
Printscreen from the Malta Corporate Registry showing that Erkam and Bulent Yildirim are sole shareholders of Hawke Bay Marine Co. Ltd. Document obtained from the Malta Corporate Registry (https://registry.mfsa.com.mt). Contributor: Delphine Reuter, ICIJ

The following screen shots, obtained from Malta Financial Services Authority records by Ahval, confirm the authenticity of the first document, and provide records of Black Eagle Marine Co. Ltd, the 2007 company registered at the same address; "198, Old Bakery Street, Valetta".

Printscreen from the Malta Financial Services Authority listing "Hawke Bay Marine Co. Ltd." registry number "C 33636". (http://rocsupport.mfsa.com.mt/pages/SearchCompanyInformation.aspx). 6 November 2017. Ahval
Printscreen from the Malta Financial Services Authority listing "Hawke Bay Marine Co. Ltd." registry number "C 33636". (http://rocsupport.mfsa.com.mt/pages/SearchCompanyInformation.aspx). 6 November 2017. Ahval
Printscreen from the Malta Financial Services Authority listing "Black Eagle Marine Co. Ltd." registry number "C 40590". (http://rocsupport.mfsa.com.mt/pages/SearchCompanyInformation.aspx). 6 November 2017. Ahval
Printscreen from the Malta Financial Services Authority listing "Black Eagle Marine Co. Ltd." registry number "C 40590". (http://rocsupport.mfsa.com.mt/pages/SearchCompanyInformation.aspx). 6 November 2017. Ahval

However, both Erkam Yıldırım and Bülent Yıldırım provided the same address in Üsküdar, Istanbul with no nameplate of a million-dollar shipping company seen from outside.

Before the ICIJ's Paradise Papers leak, the Malta Files obtained by the European Investigative Collaborations Network (EIC) revealed in May that PM Yıldırım's family (sons, daughter, uncle and nephews) fully or partially owns four companies and three ships registered in Malta; 19 companies, eight ships and seven properties in the Netherlands; a list of assets worth more than $140 million.

According to Malta Files, their partners in these companies include businessmen with close ties to the Turkish government, and relatives, who then became the frequent winners of state tenders.

Turkish prime minister's shipping career, which started in 1994 as the manager of the Istanbul's city-owned Fast Ferries Company (IDO), is a case in point: Yıldırım was reportedly removed from office in 2000 for awarding a sub-contract to his uncle, Yılmaz Erence.

After Erdoğan came to power in 2002, Binali Yıldırım was appointed as the country's minister of transport, shipping and communication, and made it policy for Turkish ship owners to fly Turkish flags and pay taxes in Turkey.

But Yıldırım set up his first offshore company back in 1998 and his family continued to operate these companies as recently as June 9, 2016, two weeks after Yıldırım's appointment as the head of Turkey's new cabinet, according to the Malta Files. In addition to avoiding taxes in Turkey by registering their shipping business in Malta, the Yıldırım family also moved a sizeable amount of wealth to foreign accounts, including the Netherlands.

Read the report on Malta Files by Zeynep Sentek and Craig Shaw here:

 

 

Two full days after ICIJ and Cumhuriyet broke the news of the Yıldırım brothers' previously unknown companies registered in Malta (and a variety of Turkish and foreign outlets covering it), the Turkish prime minister made a statement before his official trip to the United States, implicitly confirming the existence of companies, but asserting they were not secret, nor illegal. Yıldırım also demanded a probe into the news stories which, he said, "unjustly" defamed him.

In 2014, when Yıldırım was running for mayor in Izmir, a Twitter account called "@oyyokhirsiza" ("no vote for the thief") leaked the details of his sons' shipping businesses. When pressed in a TV interview on whether his family owned 30 ships, Yıldırım denied having any involvement with his sons' business, said they are accountable to Turkish law and have no impunity.

Yet, he and his son Erkam filed a legal complaint against the said Twitter account on 'defamation' grounds, eventually prompting the Turkish government to block Twitter for 10 days before the local elections. Twitter later won the case in an upper court.

The Paradise Papers is the given name of a 13.4 million files obtained by German newspaper Süddeutsche Zeitung from Appleby, a leading offshore law firm with offices in Bermuda and elsewhere, from Asiaciti, a smaller, family-owned trust company, and from company registries in 19 jurisdictions, including Malta.

The trove of documents had so far revealed that:

  • U.S. Secretary of Commerce, Wilbur Ross, has a shipping company that receives millions of dollars by doing business with a Russian company co-owned by President Vladimir Putin's son-in-law.
  • Stephen R. Bronfman, the chief fund raiser for the Canadian Prime Minister Justin Trudeau, who has a campaign promise to tax the rich, may have avoided paying taxes in Canada by moving his wealth to family trusts and shell companies.
  • UK's Queen Elizabeth has offshore investments via her private equity fund, including a U.K. based company accused of ripping off disadvantaged British citizens.
  • Queen of Jordan Noor Al-Husein owns offshore assets. 
  • Rami Makhlouf, Syria's wealthiest man and President Bashar Assad's cousin owned companies in Lebanon during Syria's occupation. 
  • Kazakhstan's defence, oil, and energy ministers had million-dollar investments in offshore companies. 
  • Former Iraqi member of the parliament, Mudhar Ghassan Shawkat, moved at least $30 million out of Iraq to avoid accountability. 
  • Former Saudi Minister of Defence Prince Khaled bin Sultan bin Abdulaziz purchased a luxury yacht via his Bermuda companies that hides his identity.

The International Consortium of Investigative Journalists (ICIJ) won the Pulitzer Prize for explanatory reporting this year. A collaboration of 380 journalists writing in 30 languages, the ICIJ includes reporter Pelin Ünker from Turkish newspaper Cumhuriyet, who will reveal more details about the Turkish players in the Paradise Papers.

Read Cumhuriyet's report in Turkish here:

 

 

Investigate the Paradise Papers yourself from the ICIJ's data here: