Those who steal in small amounts are apt to steal big sums

With the ruthless ability to disseminate propaganda of the wide-ranging and powerful media organizations it owns or controls and with its influential contacts abroad and its lobbying power, the Doğan Group is trying to advertise this tax evasion fine as "the government's attempt to silence [the group] in face of opposition," i.e., as a matter of freedom of the press. We must confess that it is partially successful in its efforts. But no one in this country who knows that the Doğan Group had received similar big fines in connection with the tax evasion of companies affiliated with Petrol Ofisi, owned by the group, and who is well aware of the financial practices of the group is surprised to hear that this groups now stands accused of tax evasion. Given the fact that in many countries those who commit financial crimes such as tax evasion are penalized not only with fines but also through long prison sentences -- as seen in the cases of Enron and Bernard Madoff, the claim voiced generally by the circles close to the group that the fine is too high is unfounded.

And it is perfectly understandable why the previous tax evasions and other financial irregularities of the Doğan Group, which has always lent support with its overwhelming media power to the repressive state practices against civilian rights and freedoms -- including freedom of the press and expression -- were not processed. This is because having always sided with the military guardianship and military coups vs. democracy and with oppressive bureaucracy vs. civilians, the media organizations of the Doğan Group have enjoyed the power to establish and overthrow governments and have become unquestionable with this power. It is because a political movement has today managed to assume government office for the first time despite opposition from the Doğan Group that the group is called to account for the corruption and irregularities attributed to it.

For instance, the Capital Markets Board (SPK) on Friday filed an official complaint at the prosecutor's office about the group's leading executives, Aydın Doğan, İmre Barmanbek, Hanzade Vasfiye Doğan Boyner and Ali Rıza Temuroğlu, and this complaint is not about recent corruption, but one which, it is claimed, was committed and covered up in the past. According to the SPK's weekly bulletin, Hürriyet Gazetecilik ve Matbaacılık A.Ş. (the Hürriyet newspaper) and Milliyet Gazetecilik A.Ş. (the Milliyet newspaper) -- their new title being Doğan Gazetecilik A.Ş. -- imported paper and printing materials at higher prices than those set by paper producers/dealers from the Sortal Trading Company Limited and Shawcliff Trading Limited, owned by the Doğan family, but which are not effectively involved in the paper or other printing material business.

The board found that with this trade, the unit costs relating to printing paper and other materials of the Hürriyet and Milliyet newspapers, whose shares are traded on the İstanbul Stock Exchange (İMKB), rose without a reasonable explanation, thereby decreasing the profits and assets of the Hürriyet and Milliyet newspapers by a sum of TL 33,117,914, excluding interest. Therefore, the SPK decided to file an official complaint about the people who were found to be involved in these corrupt practices.

Now, no one should be quick to claim that the SPK has taken actions only against the Doğan Group during this meeting. The board also decided to issue a fine of TL 112,000 each to Uzel Agri NV and SS Distribution Pte Limited. It also had some unfavorable decisions about Arena Bilgisayar Sanayi ve Ticaret A.Ş. and Hak Menkul Kıymetler A.Ş.

Here is another interesting piece of information. I worked as an editor at one of the papers of the Doğan Group for about four years. This paper was originally independently published in the English language like Today's Zaman, but when it was acquired by the Doğan Group, unusual practices began to emerge. The group used a different method to pay the monthly salary of employees. It deposited only one-third of their monthly salary in the employee bank accounts while declaring this amount as their real salary. The remaining two-thirds were paid in cash. When we raised objections to this practice, we were told that this was a common practice within the group.

I had left that newspaper by the end of 2003 but learned from friends who left the Doğan Group's media organizations more recently that the practice was still in place. Let me explain in simple English what this means: As you may know, companies operating legally and abiding by tax and insurance legislation in Turkey are obliged to pay up to 48-50 percent of the net monthly salaries they pay to their employees to the state as taxes and insurance premiums. In other words, the total cost of an employee who is paid TL 2,000 in salary is about TL 3,000, including the salary and these taxes and insurance premiums. But if you officially declare the monthly salary of this employee as TL 700 instead of TL 2,000, then your tax and premium payments are calculated at a lower ratio. If we are to go on with our example, the cost of the employee, which would normally be TL 3,000, decreases to TL 2,350 if you choose to go on with this fraudulent method. Thus, you avoid paying TL 650 to tax and insurance authorities. Is this not a crime? There is more to it, as this corrupt practice also victimizes the employees. Severance pay payable to an employee leaving this company is calculated based on this lower sum.

Who can convince me that this group, which has made it part of its corporate culture to steal small sums from taxes and insurance premiums paid over moderate salaries given to its employees, does not steal big sums from the big volume of trade and business it currently commands?