VZCZCXRO0202
RR RUEHAG RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ RUEHROV
RUEHSR RUEHVK RUEHYG
DE RUEHDA #0077 1020549
ZNR UUUUU ZZH
R 120549Z APR 06
FM AMCONSUL ADANA
TO RUEHC/SECSTATE WASHDC 4089
INFO RUEHAK/AMEMBASSY ANKARA 0638
RUEHIT/AMCONSUL ISTANBUL 0553
RUEHGB/AMEMBASSY BAGHDAD 0099
RUEHDM/AMEMBASSY DAMASCUS 0167
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHMFIUU/DEPT OF JUSTICE WASHINGTON DC
RUEAIIA/CIA WASHDC
RUEHDA/AMCONSUL ADANA 0686

UNCLAS ADANA 000077 
 
SIPDIS 
 
SIPDIS 
 
SENSITIVE 
 
NOT FOR INTERNET DISTRIBUTION 
 
E.O. 12958: N/A 
TAGS: PGOV ECON PREL PHUM TU IZ SY
SUBJECT: TURKEY: GAZIANTEP AS LIKELY TERROR FINANCE CENTER 
 
 
CORRECTED COPY: SUBJECT LINE CHANGE LIKLEY TO LIKELY 
 
¶1. (SBU) Summary:  Legitimate businesses in Gaziantep are used 
to launder money obtained through drug and fuel smuggling taking 
place in Turkey's southeast.  Gaziantep's role as a logistics 
and finance center for PKK activities serves to protect the city 
itself from becoming host to, or victim of, terror-related 
activities. End summary. 
 
¶2. (SBU) The editor of Gaziantep's local Sabah newspaper Nurgun 
Balcioglu told us that while many local textile factories are 
downsizing or closing down completely, nearly 80 percent of 
Gaziantep's industrial zone is composed of unregistered 
businesses, wherein legal commercial enterprises are used to 
launder money obtained from illegal business activity. 
Balcioglu told us that Gaziantep's former mayor Celal Dogan, who 
served for 11 consecutive years from 1989 to 1999, encouraged 
businesses from provinces like Batman and Sirnak in eastern 
Turkey to invest in Gaziantep.  These businesses used capital 
acquired from drug trafficking (from Iran and Afghanistan), or 
oil smuggled (from Iraq), to purchase existing capital assets or 
to build new factories in Gaziantep.  Balcioglu said that some 
of these business owners came to Gaziantep because they were 
afraid of the PKK, while some were directly related to the PKK. 
Gaziantep is a logistics and finance center for PKK activity in 
the southeast, and, for this reason, is rarely bothered by 
terror-related activities, said Balcioglu. 
 
¶3. (SBU) Related to Balcioglu's remarks about unofficial 
economic activities among Gaziantep's textile industries, the 
media reported on April 6 that in a raid on the Birlik Tekstil 
yarn factory located in Gaziantep's third industrial zone, 
jandarma security forces seized 50 million Captagon tablets 
illegally produced at the factory.  The factory owners were 
heavily in debt to the banks since the yarn business was not 
going well, according to the media. 
 
¶4. (SBU) Sabah owner Aykut Tuzcu told us that large amounts of 
fuel refined from Iraqi oil in Turkish refineries and destined 
to be trucked back to Iraq, gets "redirected" during transfer to 
its intended destination.  He told us that customers at some 
local gas stations can bargain the price down for such "cheap 
gas," which has the same quality as that sold in more reputable 
stations.  At the same time, Tuzcu said, Gaziantep has three 
unregistered oil refineries producing low grade petroleum 
products such as asphalt.  Tuzcu said that the crude oil refined 
in these less-sophisticated refineries is, again, "redirected" 
from tanker ships in Iskenderun and Mersin ports carrying 
Iraqi-origin crude oil. 
 
¶5. (SBU) Comment:  We had originally asked Tuzcu to help us 
set-up meetings with his contacts in local doviz exchange 
bureaus and financial firms to discuss Gaziantep's role in money 
laundering and unofficial economic activity.  Unfortunately, 
none of Tuzcu's contacts were willing to meet with us.  We will 
continue to watch with interest Gaziantep's role as a likely 
terror finance center.  End comment. 
 
REID