‘Civilian’ paşas: Businessmen who supported 1997 coup

 This is because the Feb. 28 process was also a very serious economic coup.

The mistaken practices, neglect and banks whose funds were siphoned off during that period cost the nation TL 250 billion. There were in fact quite a few trials and then punishments doled out to certain names found guilty of siphoning off bank funds at the time -- men such as Murat Demirel, Hayyam Garipoğlu, Dinç Bilgin, Cavit Çağlar and Ali Balkaner were among these names. However, none of the retired military paşas who played roles in the directorships of some of these same banks were ever dealt with in said trials. The lists of allegations never even mentioned these men, this despite the fact that all of the banks whose funds were siphoned off during that period had retired generals and even military commanders sitting on their boards of directors.

The four years between the famous National Security Council (MGK) meeting that gave the coup period its name -- the Feb. 28, 1997 coup process -- all the way to Feb. 21, 2001, was a period during which Turkey was plunged into utter economic and financial destruction. It was a four-year period for which the nation is still paying today. What’s more, to put Feb. 28 on trial, or even talk about it, without trying to expose just how it was the pockets of the nation were emptied during that time is to overlook a very critical aspect of the coup.

So, what was the real cost of this robbery for Turkey? Actually, data on this question only really became available recently. Maybe the banking sector suffered the worst losses. Between 1994 and 2003, 25 private banks were turned over to the Savings Deposit Insurance Fund (TMSF). Of these, 20 were turned over to the TMSF between 1997 and the crisis in 2001; in other words, during the Feb. 28 process. The state took on a burden of $17.3 billion by seizing the banks. And one must not forget that, in fact, the real cost of making up for the damages done by these banks was twice that figure because of the interest burden. When you add to this period the three public banks that ran up $21.9 billion in damages at the same time, it becomes clear that, from the perspective of the banking sector, the cost of the Feb. 28 process was actually more than $50 billion.

Of course, the state pursued those responsible for the corruption and many bank owners received stiff punishments, while many others fled abroad to escape prison time. The president of the TMSF at the time, Ahmet Ertürk, pursued these thieves to the best of his ability, but the amount that could actually be collected was only TL 20 billion. In the meantime, the damage done by these bank owners not only impacted on the state; between 2000 and 2002, a full 47,000 white collar workers from the banking industry lost their jobs. Pre-2001 levels of employment in the banking sector were only reached again in 2010. A study undertaken by bureaucrats in the government and ordered by Deputy Prime Minister Ali Babacan revealed the full extent of the cost of the process to the state. A special order made to clean up the burden left over from the 2001 crisis was completed and Treasury papers were given to Ziraat Bankası, Halkbank, Emlak Bankası, the Turkish Central Bank and the TMSF. This decision was made to meet the Treasury’s need for cash, and recently the state paid off TL 14.73 billion in 2010, finally paying off its debts. Thus, according to the state, inflation and figures revised to account for the current market atmosphere, the state has paid a total of TL 251.56 billion to close up the black hole created by the 2001 crisis. Put another way, the crisis, which can be called the economic result of the Feb. 28 coup, finally came to an end in 2010.

Gang of Five

It would be in no way wrong to count the “Gang of Five” as some of the leading actors in the Feb. 28 coup. Representatives from the following important business world organizations were members of this Gang of Five: TİSK, TESK, TOBB, Türk-İş and DİSK Presidents Refik Baydur, Derviş Günday, Fuat Miras, Bayram Meral and Rıdvan Budak of these organizations composed the “civilian” leg of the coup carried out against civilian politics.

Baydur wrote a book called “Bizim Çete” (“Our Gang”) about the period. Miras was the head of the Turkish Union of Chambers and Commodity Exchanges (TOBB) at the time, and as one of the most powerful members of this gang, gave his full support to the coup. As for Meral, after serving as president of the labor union the Confederation of Turkish Labor Unions (Türk-İş) for 10 years, he was elected as a Republican People’s Party (CHP) deputy in 2002. The other big labor boss in the Gang of Five was Confederation of Revolutionary Workers’ Unions (DİSK) President Budak, who became a Democratic Left Party (DSP) deputy in the 1999 elections. A short while later, saying that the DSP had lost its credibility among the people of the nation, he unfurled his flags against late Prime Minister Bülent Ecevit, and took his place in Parliament as an independent deputy. As for Turkish Tradesmen’s and Artisans’ Confederation (TESK) President Günday, he was later elected as a deputy for the CHP.

Statements made to the press much later by these prominent economic actors in the Feb. 28 process did not neglect a bit of self-criticism. There is admission by these actors that the period was a bad one, and will go down in history marked as such. Former DİSK President Budak said, “I wish Feb. 28 had never happened, and that the way forward for civilian politics had not been cut off.” As for former TİSK President Baydur, he too has expressed that the whole Feb. 28 process was damaging to the people of the nation. He even went as far as to say he believes the regime was never under any real threat, and neither is it under threat at present. In statements marking the 10th anniversary of the Feb. 28 coup process, Budak said: “May 27 [1960], March 12 [1971], Sept. 12 [1980], Feb. 28 [1997]… Had civilian politics never been cut off at the pass, Turkey would today be in possession of a mature democracy.” And so it appears that, just like so many others, important economic figures from the period are unable to rest easy in their knowledge of the storms that erupted at the time and all that was stolen from the people of the nation.

A paşa for every bank!

One of the notable characteristics from the Feb. 28 period was that some of the banks that went under had retired generals sitting on their boards. But how much did these retired generals even know about banking or the financial sector? Or more to the point, did they come to their positions as a result of their own funds in the sector? Everyone knows that the greatest factor in bringing them to these positions was that they were the “high-ranking commanders” of the era, and possessed power within the state as well as esteem among the public.

The strange aspect to this all was that later, when bank bosses and directors were being tried in courts of law, these retired members of the military were kept exempted from these trials. When Gen. Muhittin Fisunoğlu of the Turkish Land Forces, who served as head of the ranks between 1990 and 1993, was not appointed to the helm of the General Staff as the result of Doğan Güreş’s tenure in that position being extended, he retired from the military. But then Fisunoğlu became a member of the board of directors of Sümerbank. And while Sümerbank CEO Ömer Hayyam Garipoğlu was tried and punished, the same prosecutors who prepared the list of allegations that saw Garipoğlu head off to prison did not even seem to feel the need to take testimony from Garipoğlu’s colleague, Fisunoğlu.

And, of course, it really did not seem to interest anyone at the time that the same sort of thing occurred with both Etibank and Interbank. Oddly, Yurtbank and Egebank, neither of which had retired paşas sitting on their boards, saw not only their bank owners but also all of their board directors tried and punished for misdeeds. One of the most famous generals from the Feb. 28 process was Güven Erkaya, who served as a consultant for Korkmaz Yiğit, owner of the previously seized Bank Ekspres, and Kanal-6, which constantly changed hands. But when the Türkbank scandal occurred -- an event that altered Yiğit’s own fate -- no one asked who his consultant had been. The same goes for retired Gen. Vural Beyazıt, who served on the board of Etibank, and who escaped unscathed from an investigation into the company, despite the fact that Dinç Bilgin was punished. And the story repeats itself with Interbank, whose funds were siphoned off; retired Gendarmerie commander Gen. Teoman Koman, who sat on its board, was neither questioned nor tried in court in any way.

Despite the fact they paid a price for it, the bank owners and large companies of the Feb. 28 era picked up great benefits from the esteem accorded to these retired paşas. It should be noted, after all, that it was not just some banks that had retired high-ranking military generals sitting on their boards, but also some of Turkey’s largest companies. But the first name at the helm of the General Staff to really experience the damage to the esteem accorded to the military as a result of these activities was Gen. Hüseyin Kıvrıkoğlu, who served between 1998 and 2002. It became quite clear during these years that even though the paşas in question were not being pursued for misdeeds, the public conscience had been dealt a blow. The general that followed Kıvrıkoğlu to the helm of the General Staff was Hilmi Özkök, and he put an end to the practice of retired generals taking positions on bank boards. Of course, this ruling only put an end to one aspect of that dark period and its questionable practices. And now, only time will actually tell whether these retired generals will be made to pay for their roles in the economic damage caused to the people of the nation, as well as to answer for their own legal responsibilities.

What general can be found where?

A list of some of the banks and large companies where retired generals sat on boards and took on duties: Former Chief of General Staff Gen. Semih Sancar (Akbank Board member), Sept. 12, 1980 coup Gen. Turgut Sunalp (Netaş and Garanti Bank board member), retired Land Forces Commander Gen. Muhittin Fisunoğlu (Sümerbank board member), retired Gendarme Commander and National Intelligence Organization (MİT) Undersecretary-General Gen. Teoman Koman (İnterbank board member), retired Naval Forces commander Adm. Vural Beyazıt (Etibank board member), Gen. Adnan Ersöz (İşbankası board member), Gen. Süreyya Yüksel (Yaşar Holding consultant), Gen. Vecihi Akın (AKSİGORTA board member), Gen. Doğan Özgöçmen (Yapı Kredi Bank board member), Gen. Suat Aktulga (LASSA board member) and Gen. Şeref Akıncı (Doğuş Holding board member).