Months after Turkey dismantled a major network accused of selling citizenship through sham property deals, new forms of fraud have begun to surface, exposing the limits of recent reforms.
After hundreds of citizenships were revoked and dozens of suspects arrested in the 2025 crackdown, authorities say fictitious sales and inflated paper valuations have re-emerged at a lower but persistent level. These schemes exploit narrow enforcement gaps and rely on coordinated networks linking real estate firms, brokers and corrupt officials to produce documentation that appears lawful on paper while remaining fraudulent in substance.
The scandal first came to light in September 2025, when Turkey's interior ministry announced the dismantling of an Istanbul-centred criminal network accused of arranging sham property transactions for foreigners seeking citizenship. Coordinated raids across 19 provinces led to the arrest of 106 suspects and uncovered fraudulent files linked to around 451 foreign investors and their families.
Authorities moved to revoke the citizenship of those implicated and seized assets, including more than a thousand apartments, dozens of vehicles, as well as companies and bank accounts. The case was described as one of the largest known manipulations of Turkey's citizenship by investment programme and prompted a sweeping overhaul of oversight procedures.
A well-informed source within the ruling Justice and Development Party told The New Arab that the new safeguards had reduced but not eliminated abuse. The source said some brokers and real estate companies continue to test the system, although their activities are now under constant monitoring.
Newly uncovered networks typically involve three actors working in coordination, namely a property owner or real estate firm, a broker, and corrupt officials within public bodies, including land registry offices and population and citizenship directorates. Confessions obtained during the initial investigations have helped authorities identify additional suspects, with further citizenship revocations expected.
Officials say the file is being monitored daily because of the damage caused to the credibility of Turkish citizenship and the wider economic impact. Artificial price inflation has distorted the real estate market, worsened the housing bubble and raised concerns over money laundering, with indirect effects on speculation and pressure on the lira.
A policy under strain
Turkey introduced exceptional citizenship by investment in 2017 as part of a broader strategy to attract foreign capital, particularly into real estate. The property threshold was initially set at one million dollars, lowered to $250,000 in 2018, then raised again to $400,000 in 2022. Parallel routes exist through bank deposits, government bonds or real estate investment funds, typically starting at $500,000 with a three-year holding requirement.
The policy coincided with a construction-led growth model and chronic currency weakness. Foreign buyers, particularly from Russia, Iran, Iraq and several Arab countries - driven by sanctions pressures and geopolitical instability - became an important demand segment, helping to support prices and foreign exchange inflows.
At the same time, the scheme fuelled domestic anger over housing affordability and accusations that citizenship was being commodified.
How fraud evolved
Earlier schemes exploited valuation reports issued by private companies, allowing brokers to inflate property prices on paper to meet citizenship thresholds. Authorities later revoked private accreditations and restricted valuation reports to state bodies, closing off a major avenue of manipulation.
According to valuation experts, two main methods persist. One targets investors outside Turkey, who are sent forged documents for properties that do not exist. The other involves the investor’s knowledge, with the buyer transferring the full required amount before receiving a large portion back through side arrangements, while a lien is placed on the property. Authorities classify such practices as money laundering.
Tighter controls and legal risks
Since late 2024, Turkey has rolled out stricter digital controls. Valuation reports are now cross-checked against tax values, sale prices and title deed data. Applicants must present a Foreign Exchange Purchase Certificate proving that foreign currency entered the banking system. Platforms such as Web Tapu and a unified property identity code have been expanded to ensure traceability and prevent duplicate registrations.
Despite these measures, limited manipulation persists. Lawyer Ghazwan Qarnfal said confirmed violations represent a small fraction of the estimated 35,000 investors who have obtained citizenship through property purchases since 2017. However, enforcement risks have increased sharply.
Under Citizenship Law No. 5901, citizenship granted on the basis of false information or forged documents can be revoked retroactively, including for family members. Penalties also include property seizure, denial of compensation and deportation, as seen in the case of the 451 investors stripped of their citizenship last September.
While the government insists the programme remains lawful and economically necessary, the scandal has deepened political debate over the costs of tying citizenship to property investment, highlighting tensions between attracting foreign capital, protecting the housing market and preserving the credibility of Turkish nationality.