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Fraudulent Methods of Turkish Citizenship are Detected

The main reason for granting citizenship through investment in Turkey is to directly bring 250.000$ to the country's economy. Any application preventing the direct entry of this amount is considered illegal, and citizenship status can be canceled later even though applications are complete before the ill-intent is realized.

According to the latest investigations, it has been determined that the citizenship process is used for fraud by some payment methods. To prevent different methods of fraud in the process, the state has made some amendments to the related laws. The aim of the state in preventing such investment fraud is to ensure that the investments are made correctly. Which is the main reason that attempts from malicious third parties are and will be blocked by the Turkish Government. The new circular regulations published by the TKGM (Turkish General Directorate of Land Registry and Cadastre) on 22.03.2021 have announced that from the 22nd of March 2021, a seller cannot give a buyback guarantee anymore for the property which is used for citizenship purposes. 

Property BuyBack Guarantee is Not Applicable

Property Buyback Guarantee is Not Applicable Anymore

The buyback guarantee offered by the construction companies hampers the state instead of achieving its original intended purpose, and this method appears only as a means of cunning marketing for citizenship applications. Some companies provide citizenship opportunities by selling a property for less than 250.000 USD. They show the appraisal report as 250.000 USD, which is generally much higher than the real value of the property. This system can be supported by a buy-back guarantee given after an average of 3 years which is the necessary period to apply for citizenship by investment. When it comes to the buyback guarantee, which allegedly aims to protect investors against price instability, they often tend to keep buyers at receiving end by assuring they will repurchase the property at a 30-35% higher price.

To clear with an example;

In order to apply for citizenship, you need to invest 250.000$ and prove your investment to the Turkish Government. During this stage, some construction companies sell you a property worth less than this price, let's say 150.000$. They change the appraisal report of this property for 250.000$ and apply for citizenship, and they give a clawback guarantee to the property after 3 years, which is the necessary waiting period for citizenship applications (with new regulations, this property cannot be used for another citizenship application). After 3 years, they repurchase the property from you at a 30-35% higher rate, giving you the extra amount that you spend on this property.

The new amendments are to terminate these efforts from turning it into a commercial purpose. With this circular, when a buy-back guarantee is determined by the authorities, the citizenship will be canceled even 3 years after the acquisition.

Paid in Advance Rental Income Guarantee Method is Fraud

Paid in Advance Rental Income Guarantee Method is Fraud

The buyback system is mostly supported by a paid in advance rental income guarantee. Paid in advance rental guarantees are the repayment of the excess money received for the property which is sold higher than the real value on the first stage of purchasing to the buyer. Early rental guarantees used as a strategy by construction companies are marketing tricks. These tricks are an example of turning the citizenship process into a deceptive business model in the real estate industry.

According to the new regulations effective as of 22nd March 2021;

• The seller cannot buy the same property back, which is sold for citizenship purposes after 3 years citizenship period ends.
• If a property has been used for Citizenship before, this property can never be used with this purpose anymore for another foreign buyer. The same property cannot be used for more than one citizenship application.
• Paid in advance rental income guarantees for the citizenship process are not valid anymore.

If the buyer has citizenship obtained with one of these conditions above, even if acquired by the seller, it will be canceled by authorities and the buyer will lose vested citizenship rights. Click here to read more information about the regulations.

As a reliable and trustable real estate company, we always work with legal and ethical rules. We are aware of the importance of building trust and we recommend that foreign investors and homebuyers should obtain citizenship in Turkey in a legal way. Being part of fraud means paying for someone else's mistake and risking an important issue like citizenship can cause unintended consequences. Be aware that citizenship acquired by fraudulent ways harms the Turkish nation as well. Respecting the law is the paramount importance to ensure confidence.

Further Information: Read the Citizenship in Turkey page to get more detailed and accurate information about the process.

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Created: 13.04.2021, 00.00Updated: 14.09.2021, 07.57
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