Westpac, Commonwealth Bank of Australia, and ANZ Banking Group cut off Australian citizens from their bank accounts based on unverified claims from the Turkish government that they are terrorists.
Citizens and others here on protection visas who are part of the Gulen movement, a network that was once allied to President Recep Tayyip Erdogan but has since fallen foul of his increasingly autocratic regime, have been targeted by the Turkish government.
Erdogan claims members of the dissident group, a liberal sect of Islam named after US-based Sunni cleric Fethullah Gulen, were solely responsible for an attempted coup in 2016. Gulen denies the charge and Western governments largely reject the claim too. Nonetheless, the Erdogan government designated them the Fethullah Terrorist Organisation (FETO).
The listing of Gulen members as terrorists has trickled through to financial data firm Refinitiv, a provider the banks rely on to help with so-called “know your customer” requirements designed to minimise risky lending. Australia’s big banks have strict anti-money-laundering and counterterrorism finance laws and use third-party financial data providers as well as other background checks when assessing customers’ risk.
As a result, Australian banks Westpac, its subsidiary Bank of Melbourne, CBA, its subsidiary Bankwest, and ANZ have closed retail and business bank accounts of some Turkish Australians linked to the Gulen movement. The action is known as debanking.
Mehmet Saral is one of them. The Sydney man has lived in Australia since he was 8 years old. He found out he was on Turkey’s Ministry of Interior most wanted list in October 2021 with a 500,000 Turkish lira ($28,646) bounty on his head.
In December 2021, Refinitiv’s World Check listed Saral as an unconvicted terrorist following the circulation of the Turkish government’s Resmi Gazete, which alleged he was part of the FETO. He is a member of the Gulen movement and chairman of one of its advocacy groups, Advocates For Dignity, based in the western Sydney suburb of Auburn.
FETO is not deemed a terrorist organisation by the United States, European Union, or Britain. Nor in Australia, the Attorney-General’s Department confirmed.
For Saral, the sudden shutting of his accounts has caused major disruption to his life. In early 2022, his near 25-year-old account with Westpac was closed, along with newer accounts at Bankwest and ANZ, CBA accounts related to his mother, and an account related to a non-government organisation he was president of.
Refinitiv documents obtained by The Australian Financial Review show the listing of some individuals’ reports in the “non-conviction terror” category. The World Check reports relied on Turkish government gazettes and no other sources to determine Saral, and another man Mesut Lelik, were allegedly terrorists.
“Having my bank accounts closed has had a great impact on me,” Saral says.
Having just started as a telecommunications engineering manager at a major Australian IT company, Saral was concerned his employer thought he was money laundering because he kept changing his salary payment account. After losing his job, he could see his money in his Bankwest offset account, but frustratingly was not allowed to access it.
‘No weight’ placed on sanctions
After four months, Saral convinced Refinitiv, a London Stock Exchange-owned company, he wasn’t a terrorist and his designation was changed to an “individual” whom the Turkish government had sanctioned, which referred to the fact he had had assets in Turkey frozen. World Check has now added information from the United Nations that there are serious “due process violations in respect of designation [as a terrorist] by the Turkish authorities” to his report.
“In the circumstances, no weight should be placed on the reported justification for sanctions without separate and independent verification,” the updated Refinitiv report says.
However, the change did not move the banks, and for well over a year, Saral has struggled to get their attention and his accounts back.
Following a month-long investigation by the Financial Review questioning the veracity of information the banks rely on, CBA reviewed and reversed its decision on Saral last Friday evening. On Wednesday morning, Westpac and ANZ followed suit.
“After a detailed review of our original decision and in view of further information that has come to light, we have notified our customer that the previous decision has been withdrawn and he is now able to apply for products and services offered by CBA and Bankwest,” a CBA spokesman said.
CBA said normal credit and identification will still be required and apologised to Saral.
It is unacceptable for any foreign government to target members of our community in ways that prevent [them] exercising their fundamental rights.
— Home Affairs Minister Clare O’Neil
Banking industry sources say they understand the frustration felt by customers whose accounts were closed without any real explanation. But given tough financial crime laws, if banks were to provide services to actual terrorists, they would face civil and criminal action, significant fines and limits placed on their activities.
As well, the banks are gagged under current Australian law from even telling them why their accounts have been closed, although this is likely to change.
Banks must be more transparent
In June, the government said it supported “in principle” a recommendation from the Council of Financial Regulators (CFR) – the co-ordinating body for Australia’s main financial regulatory agencies APRA, ASIC, the RBA and Treasury – to introduce transparency and fairness measures that would require banks to document and provide reasons for debanking. Lobby group the Australian Banking Association says it is “working closely with Treasury to find solutions to this challenging public policy issue”.
In the meantime, the Financial Review has been told of at least a dozen more individuals who were debanked. Some asked not to be named for fear of retribution from the Turkish government towards them and their families. The Turkish government has been credited with abducting people allegedly associated with the Gulen movement in countries such as Malaysia and Kosovo.
One person who has had accounts restored is Mesut Lelik, who was targeted by the Turkish government for his long-term association with Gulen schools and organisations in Australia and Turkmenistan.
Labelled as a terrorist in World Check, Westpac’s Bank of Melbourne and Citibank closed his bank accounts, and CBA refused to loan him more money despite having a loan to build a new home in Melbourne.
Lelik took the extraordinary step of requesting criminal background checks with the Australian Federal Police and Turkey’s Ministry of Justice. Both checks, which have been seen by the Financial Review, came back with no disclosable court outcomes despite Turkey listing him as a terrorist.
After getting a loan from a friend, Lelik was able to complete construction of his home. Afterwards, NAB approved a bank account and home loan, allowing him to pay back his friend and CBA, so he could move into his new home.
“With my complaints and proof of being hard done by, I received a letter of apology from the Bank of Melbourne, and they informed me that I could now open an account with them,” he says.
The Australian government has proven largely powerless to intervene despite pleas to local members. The government can’t force a bank to reverse its decision.
Pleas to ministers
The plight of affected citizens has gone to the highest levels of the Australian government, including cabinet ministers Clare O’Neil and Assistant Treasurer Stephen Jones.
“It is unacceptable for any foreign government to target members of our community in ways that prevent individuals exercising their fundamental rights and freedoms in Australia,” Home Affairs Minister Clare O’Neil wrote to one man’s local member, Werriwa MP Anne Stanley, after she shared his story with her colleague in July 2023.
“[The man’s] reports have been referred to the appropriate law enforcement and security agencies for consideration.”
In a separate letter, following correspondence with Stanley, Jones said the situation of the two men was being considered as part of policy responses to the issue of debanking.
“Debanking is a global policy challenge and developing policy responses to address debanking is very challenging with no widely acknowledged solutions,” Jones wrote in July 2023.
A London Stock Exchange spokesman says World Check is designed to help organisations meet risk regulations set by government agencies.
“We aggregate data from publicly available information and reputable media sources but do not draw any conclusions on an individual or make any financial decisions,” he says.
“Our data is continuously assessed to ensure it remains up to date and we have multiple fields and secondary identifiers to minimise false positives with manual human fact checking and verification.”
Gulen ‘wiped out’ in Turkey
Dr David Tittensor, senior lecturer in Islamic studies in the Asia Institute at Melbourne University and author of several books and several academic papers on the Gulen movement, says FETO is a designation by the Turkish government and did not exist before 2016.
“As a result of the corruption probe in 2013, they started going after the Gulen movement, purging them from the judiciary, the police and so forth. They started to slowly dismantle their organisation over the next couple of years,” Tittensor says.
“When the coup attempt happened, Erdogan made the accusation that it was just the Gulen movement. That allowed him to accelerate, and he really just wiped them out completely in Turkey.”
Tittensor says the Gulen movement is far from a terrorist group, and notes it was previously allied with Erdogan. He disputes the idea they could have run an attempted coup by themselves. The military has long been the guardians of the secular state in Turkey, he says, weeding out people with an inclination towards religion from its ranks and staging coups when it felt the secular nature of the state was being undermined.
By: Max Mason
Source: Financial Review
