North university ‘was paying invoices for students who did not exist’

The now-infamous Cyprus Health and Social Sciences University (KSTU) in Morphou was paying invoices to a student recruitment agency for students who did not exist, according to witness testimony in court on Tuesday.

The claims were made as part of the preliminary inquest into the ‘fake diploma scandal’, which has thus far been centred on the university.

The university’s 30-per-cent shareholder and secretary-general Serdal Gunduz and its international office manager Amir Shakerifard were both charged with 130 counts of fraud, document forgery, and other related crimes at last week’s hearing into the matter.

Gunduz and his assistant Berke Ozbek also face the 98 charges of fraud, falsifying documents, money laundering, and other similar crimes related to the scandal in another court in northern Nicosia.

In court on Tuesday, witness and accountant Okan Ozturk explained that the university’s founder Ece Uysal had requested he travel from Turkey to the island to carry out an investigation into the university’s accounts.

That investigation unearthed what Ozturk described as “irregular findings” related to a company by the name of “Study in Cyprus”.

He explained, “purchases made with agencies which provide students to universities are subject to a contract. These types of companies receive commission for each student they bring. Since there is no contract for the invoices and some invoices do not include a reference to the student for whom the invoice was issued, it is suspicious.”

He went on to say that during his investigation into the matter, he found lists of students for whom invoices had been paid but found that the students in question had “no connection” with the agencies and had registered themselves at the university without any help from any agency.

Additionally, he said, he found instances of more than one invoice being paid for the same student, and that with this in mind, he had forwarded his findings on to the university’s acting director Mehmet Altuntas.

Altuntas also spoke in court on Tuesday, saying that he had first been brought to Cyprus with his company Helpco to investigate “suspicious transactions” related to the university.

“We examined the agency invoices and payments … The examinations are the work we conducted with [Ozturk]. We first started examining payments exceeding $100,000 and €100,000. Here, we came across a payment of €146,096 to the ‘Study in Cyprus’ company as commission for students,” he said.

He said that he had then requested a sample invoice from the university’s accounts department and were presented with an invoice for €48,810, but “could not find any information regarding for which students the payment was made”.

He said he had then requested a copy of the contract related to the invoice from the company, but that the company had told him there was “no such contract”.

“Since agreements are made with agencies for different amounts, there needs to be a contract. Since there was no student list and no contract, we gave a statement to the police regarding a suspicious transaction,” he said, adding that he was then given power of attorney by Uysal regarding the issue.

Additionally, he corroborated Ozturk’s earlier statement about students included on invoices having no relation with the agency.

“In our interviews with the students in question, they told us they had registered directly with the school, they did not communicate with such an agency, and they did not have any correspondence, communication, or documents,” he said.

The Morphou case is set to reconvene in court on Thursday, while the case in northern Nicosia is set to continue on October 1.

The “fake diploma scandal” rocked the north’s higher education system during the first half of the year, with a raft of high-profile arrests having been made in connection with alleged forgeries of documents, bribery, and money laundering.

Gunduz is just one of numerous high-profile figures to have been arrested in connection with the scandal, with former ‘education minister’ Kemal Durust, his wife and high-level civil servant Meray Durust, former Yodak chairman Turgay Avci and board member Mehmet Hasguler, and Ersin Tatar’s bodyguard Serif Avcil having all also been arrested this year.