Rogue Turkish agents investigated for embezzlement

Published 15/04/2019

An education agency in Turkey has fired three of its employees after they were caught stealing from their Work and Travel students’ tax returns.

According to reports in the Turkish national media, the three colleagues embezzled the funds by claiming back tax returns without the knowledge of 122 of their students in the US on Work and Travel visas.

“Three employees have admitted responsibility”

By incorrectly filing students tax returns, they claimed back tax refunds successfully for 45 students, totalling to around $50,000-60,000, according to somebody with knowledge of the situation.

The company involved insists that it didn’t know about its employees actions, and fired them immediately after the situation was brought to light.

“These three employees have admitted the allegations and they regret it,” the lawyer representing the company said.

“The company has been abused. They caused a greater financial trouble than what they gained. We’re trying to compensate the students’ unjust treatment,” Görenc Locin added.

In 2018, changes in IRS protocol resulted in personal exemption being suspended and those earning less $9,525 no longer being eligible for federal tax refunds – it is understood that the three alleged continued to apply for federal tax refunds without the knowledge of the students.

One of the suspects told the national daily Hurriyet newspaper that they acknowledged the detrimental effects of their actions.

“We committed a crime here and we are feeling severely punished at the moment,” they said.

“We lost our jobs and all we have. Now we’re going to the court. We didn’t foresee the outcome of this. We acted greedily.”

An unnamed student told Hurriyet that “both my money was taken and my name was used”.

“Now we’re trying to solve this problem,” they said.

Students caught up in the situation are worried about potential future consequences.

“I’m worried I might need to go back to the US but I don’t know what’s awaiting for me,” another student said. “Maybe they won’t give me a visa, or my work permit with be cancelled.”

For one source close to the situation, claiming back tax by deceiving the IRS is becoming a systematic problem, which needs to be attended to immediately.

“My role is now to stop this problem in Turkey forever”

“The bigger part is that J-1 students, either themselves or through other people, have been filing illegal applications to the IRS, and getting money,” they told The PIE News.

Using services such as TurboTax and FreeTaxUSA, which are legal for US citizens and residents, Work and Travel students have been claiming back tax illegally from the US. It is not clear how far reaching the problem is, they said.

TurboTax also has to take action against this, the source argued.

“I think not only in Turkey – Russia, Germany, other countries as well – it has to be stopped.” 

At least one firm, which asked not to be identified due to the high profile nature of the story, told its Work and Travel students to sign a guarantee saying they would not apply for tax reimbursement on return to Turkey.

“My role is now to stop this problem in Turkey forever, and no one can get US taxpayers money illegally like this,” the firm’s managing director explained.

The company is now in touch with its Work and Travel students and updating their files to ensure no tax has been reclaimed. Any refunds will be paid back to the IRS, the source highlighted.

The situation could threaten the Work and Travel program to Turkey, agreed Atlas managing director Mesud Yilmaz, as he warned that Turkey’s Work and Travel agencies might get hurt further.

“We don’t know where it will go, but it is not good for overall agency reputation. This kind of news does not help other players.”

Other education agencies in Turkey are also worried how it could impact business.

Although the Work and Travel program is run by a specific few agencies in Turkey, the situation could have a wider impact said Alternatif managing director, Serap Aslanatur.

“As you can imagine every inappropriate conduct will have a negative impact on the agency business,” Aslanatur noted.

“This case will not unfortunately be an exception.”

The majority of the agencies abide by the highest ethical standards, she told The PIE.

“We believe this case is an act of some individuals, which will have some impact, but we are sure which ever agency is involved, it will find a way to resolve this issue as much as possible.”

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