First, let’s summarize the events that took place (see: https://www.bbc.com/turkce/articles/c6p60q92vn3o#:~:text=Eski%20Denizbank%20Levent%20B%C3%BCy%C3%BCkdere%20Caddesi,ile%20ilgili%20merak%20edilenleri%20ara%C5%9Ft%C4%B1rd%C4%B1 .)
According to the information contained in the indictment, Erzan became the manager of Denizbank’s Çorlu branch at the age of 24. After working in Çorlu for approximately 10 years, he was appointed manager of the same bank’s Istanbul Bahçeşehir branch in 2011, and shortly thereafter, the Florya branch. Finally, he was appointed manager of the Levent Büyükdere Street branch. During his time in Florya, Erzan appears to have established close relationships with Galatasaray athletes due to the location of Galatasaray Football Club’s Metin Oktay Facilities. According to the report, Erzan began collecting money from various clients and investing in the stock market in 2011. However, when these unofficial actions, carried out without the bank’s knowledge, resulted in significant losses in the stock market instead of the profits he had planned, he began accepting money from acquaintances with the promise of investments to cover the losses. Thus, the Ponzi scheme began.
Seçil Erzan’s statements indicate that the deficit was constantly growing and that it reached a dead end starting in 2021. She recounts that events took a turn for the worse in 2023. Erzan then began receiving large sums of money from certain individuals, telling them that there was a secret fund in the bank, generating high returns, and that former Galatasaray coach Fatih Terim and Denizbank CEO Hakan Ateş were also involved.
The “system” Erzan established
However, according to the indictment, no such fund existed. According to his testimony, Erzan put into place a “system” that involved paying off someone’s debt with money borrowed from someone else. The money was allegedly hand-delivered in bags, some inside the bank and some outside. She allegedly provided documents he prepared, some bearing Denizbank’s stamp and wet signature, to those who requested them.
In his testimony, Erzan summarized the “system” she established with the following sentences:
“I promised the people I promised funds to that it was a high-yield fund, that people like Hakan Ateş and Fatih Terim had invested in this fund, that the fund had maturities of 30-45 days, and that I would earn returns of up to 20, 30, or 40% at maturity.
I was so stuck that, because I was distributing so much interest, I took money from people under the promise of funds and tried to pay the high interest rates they demanded.” Erzan also made statements about the amounts of money he received from individuals.
Celebrities from whom she collected millions of dollars
For example, she claims to have received a total of $13,900,000 from Arda Turan, the famous footballer who played for Galatasaray, Atletico Madrid, and Barcelona, and to have repaid $6,400,000, but has been unable to repay the rest. He also claims to have received a total of $4,200,000 from Emre Belözoğlu, who played for Galatasaray, Inter, Atletico Madrid, and Fenerbahçe, but has never repaid them. Erzan’s statements include many prominent figures and businesspeople in the football world, including Arda and Emre.
Erzan also claimed that during this period, people who saw that she was in a difficult situation extorted promissory notes from her and that these individuals frequently threatened her. This scheme was uncovered when she was unable to make the payments after a while. Some of the people who had given Erzan money contacted the bank on 7 April 2023, when they could not reach him. During this period, a criminal complaint was filed against Erzan, and the investigation process began. Erzan was detained in Çorlu on 11 April 2023.
A Personal Perspective
Now, I’d like to explain this incident from my own perspective, based on an experience I had.
If I remember correctly, in 2015, we were in negotiations with various banks to finance a 5 MW solar power plant (SPP) project in Kulu, Konya. Around that time, our paths somehow crossed with Denizbank. They were initially very interested in the project. We even held a series of meetings at the highest levels, including with the bank’s general manager and the relevant deputy general managers. To apply for the project loan, we were initially directed to a branch specializing in these types of solar power plant and wind power plant (WPP) projects. The branch manager was a young and intelligent man who truly knew the industry and the dynamics of solar power plant and wind power plant projects. He and I worked on our loan application for a few weeks, bringing the project to the bank’s desired format. Everything was ready. The process moved quickly, and we finally submitted our project financing application through that branch.
A veiled offer
It took the bank about a month to respond to our case. After a month, they called us back to headquarters. The process was progressing smoothly, but after the evaluation meeting, we held at headquarters, I was frankly disappointed. We had no shortcomings; the project was solid, and we were one of the newer, more promising companies in the sector. During the meeting, they told me they could transfer us to another branch. They implicitly stated that working with another branch with the bank’s largest accounts would move things much faster, that the branch manager had excellent relations with headquarters, and that the loan would be approved quickly. I don’t remember her exact name, but I vaguely recall them saying “Seçil Hanım” (Ms. Seçil) when referring to this branch manager. I politely declined the offer and bluntly stated that we were very pleased with the branch manager we were working with and that we wanted to complete the process without changing branches.
A few days after this meeting, I received another call from the bank’s headquarters. We did similar things in that call. They insisted they could transfer us to the other branch they mentioned and then demanded I speak with the branch manager. I told them, “Why are you asking me to move to another branch? I already work with a good branch manager. He understands the dynamics of project finance and has expertise in the renewable energy sector.” To avoid upsetting them, I told them I would speak with the manager of the branch they recommended on the phone, and I did. I then repeated what I had told the head office: “You’ve expressed interest in working with us at headquarters. Thank you for your request, but I’m happy with the branch manager I’m working with now and don’t plan on changing.”
Refusal Followed by Persistence
The woman I spoke with was initially quite insistent, boasting about what they could do for us, but after I told her I wouldn’t change my mind, I remember her tone and manner of speaking that indicated she wasn’t at all happy with my approach. Then, we hung up, a bit rudely. About a week after this conversation, headquarters contacted us stating that our request had been rejected. I briefly discussed this with the branch manager we were hoping to work with, and he commented something along the lines of, “I don’t understand why this is happening,” and expressed his deep regret. I wished him good health and hope to work with him again in the future. As a result of all these bank discussions, we decided to work with TEB for our Konya Kulu Solar Power Plant project. This decision also secured TEB’s first official solar energy project financing. The installation of this plant was completed successfully, ahead of schedule, remained in operation for a year, and exceeded all our expectations in terms of production. We then sold the project to an investor with a good profit margin, paying off TEB’s loan in one go.
Discouragement Instead of Support
I’ll leave an assessment of my experience with Denizbank to you. I’d also like to point out that, among the banks I’ve dealt with, Denizbank is one of the best. There are valuable professionals there who put in serious effort and know their jobs well. In fact, I can say this: based on my experience, there are banks and bankers in far worse situations than Denizbank. Banks that prioritize creditworthiness, or even pretend to, often hinder the real sector, which is struggling due to the challenging economic climate, rather than supporting it. We often see that they choose to attack companies that are struggling due to reasons beyond their control (such as a national economic crisis or collection difficulties), rather than rescue them. We need to ask banks this: What is your goal? Eating grapes or beating the vineyard owner?
Of course, who keeps track of the banks and bankers who keep track of individuals and companies in Findeks, credit scores, and interbank communications? The Banking Regulation and Supervision Agency (BRSA) may be partially responsible for this, but I believe there shouldn’t be other oversight systems besides the BRSA for banks and bankers who abuse their power and engage in corruption, theft, and fraud? After all, trust is the greatest strength of banks. When trust is broken, the entire system is shaken. That’s why I think credibility systems like Findeks should be created, where banks are audited, bankers’ pedigrees are established and are open to the public and the private sector.
And of course, there’s what needs to be done about the fraudsters and loan sharks who are the real source of these fraud cases. They have no place to rest. These human scoundrels, who have shattered the homes and lives of many innocent people and even driven many to suicide, must be eradicated. I’ll reserve any further writing on this topic for later. However, I also know that if the state demonstrates the necessary will, it will eradicate the fraudsters and loan sharks. Much needs to be done.
Unaddressed Questions
Returning to the Seçil Erzan incident, I think the following questions should be asked of Denizbank’s executives (from what I’ve read, the answers are always mixed and not fully addressed):
– Were you aware of the transactions Seçil Erzan engaged in?
– She started the fraud in 2011. How has she evaded all audits and inspections for 12 years? If the bank provides an environment of trust, shouldn’t the bank cover this $40-odd million in debt, whose whereabouts no one knows for sure? In fact, I think they should have done this before this incident hit the newspapers. Then the bank could have taken responsibility and resolved the problem before it escalated. I believe this incident has damaged the entire banking system.
Who were the bank executives at headquarters who were in contact with Seçil Erzan and supported her? What was their motivation for this support?
How did she become a branch manager in a major industrial center like Çorlu at the age of 24? What qualifications did she possess at the time?
I remember vividly that Denizbank once ran major campaigns with the Big Three. What qualifications did you base your appointment of Seçil Erzan as Florya branch manager to manage relationships with a club like Galatasaray, a club with over 30 million fans, and who would provide the bank with perhaps its largest customer base?
Why don’t bank executives come clean and address the rumors and accusations? They’re creating the impression that they’re trying to make people forget about this by relying on the Turkish people’s tendency to forget events quickly.
– With such large sums of cash flowing in and out of branches, didn’t the bank’s security ever detect anything suspicious and report it to their superiors?
In our country, where fraud has skyrocketed due to the economic downturn, distinguishing genuine fraudsters from honest individuals has become more difficult than ever. In this uncertain environment, who will hold accountable the fraudsters who emerge from among banks and managers who prey on people or companies with good intentions, who have been hit hard by the current circumstances, who will pay when they have the money, and who often fail to pay for reasons beyond their control?
It’s time to discuss the banking system
I have much to say about the banking system, which I’ll save for another blog post. But I want to emphasize that there are different ways to eliminate, or at least significantly reduce, all these fraudulent incidents. Certain innovations are needed in every bank department. The first solution that comes to mind is to implement blockchain-based technology for all banking transactions, contracts, and approval mechanisms. Because blockchain technology doesn’t allow for empty promises. In a worst-case scenario, the transaction simply won’t happen. It’s that simple.
It’s time to discuss the banking system in detail. A system that remains cumbersome and inactive, and that allows all sorts of fraudsters to emerge, needs a complete overhaul. Instead of the current dysfunctional system, I’m talking about a structure that supports well-intentioned and well-functioning individuals in the real sector who find themselves in dire straits due to the current economic climate, instead of destroying them, and instead supports them, improving their situation and enabling them to contribute to the economy again. It’s a system based on technology (blockchain, etc.) and protects the system from fraudulent exploitation from the very beginning.
Tag: education
