Company Revenue Diverted to Another Business in Turkey: Director Liability and Recovery Claims

Company Revenue Diverted in Turkey: Director Liability and Recovery

What can shareholders do when company revenue is diverted to another business in Turkey? Learn about director liability, evidence, asset tracing, injunctions, and recovery claims.

When company revenue is diverted to another business, the company may suffer serious financial losses while directors, shareholders, or affiliated entities receive an improper benefit. This situation may arise through redirected customer payments, false invoices, undisclosed commissions, related-party contracts, unauthorized transfers, or the use of company resources for another business.

Foreign shareholders may discover the problem only after reviewing financial statements, bank records, customer accounts, or unexplained changes in profitability. Prompt legal action is important because money may be transferred again, records may be deleted, and company assets may become difficult to recover.

What Does Revenue Diversion Mean?

Revenue diversion occurs when income that should belong to a company is transferred, concealed, or collected by another person or business without a valid legal or commercial reason.

Common examples include directing customers to pay an affiliated company, issuing invoices through another business, transferring profitable contracts, collecting company receivables into a personal account, recording fictitious expenses, or using company employees and equipment to generate income for another entity.

A legitimate group-company arrangement is not automatically unlawful. The key issues are whether the arrangement was disclosed, properly approved, accurately recorded, commercially justified, and beneficial to the company.

When Can a Director Be Held Liable?

A director may face personal liability if they use their position to divert company income, conceal transactions, misuse corporate assets, or cause damage through intentional or negligent conduct.

The risk is particularly high when the director controls the receiving business, signs contracts for both entities, directs customers to the other company, approves payments without documentation, or receives a personal financial benefit.

The director’s authority, the company’s articles of association, shareholder resolutions, internal approval procedures, and the existence of a conflict of interest will be examined. The mere fact that the receiving business is related to the director does not automatically prove liability, but undisclosed and commercially unjustified transactions may create strong grounds for a claim.

What Evidence Should Foreign Shareholders Examine?

A foreign shareholder should begin with the company’s financial and corporate records. Bank statements, invoices, accounting ledgers, customer contracts, payment instructions, commission agreements, loan records, board minutes, and shareholder resolutions may reveal where the revenue was transferred.

Electronic evidence is also important. Corporate e-mails, cloud accounting systems, CRM records, electronic invoices, digital signatures, online banking activity, document access logs, and messaging applications may show who redirected the income and when the conduct began.

The company should compare customer payments with invoices and bank deposits. It should also investigate whether customers were told to pay a different account, whether invoices were issued by another business, or whether the same services were performed using company employees and equipment.

Evidence should be preserved in its original form. Unauthorized access to private accounts, deletion of records, or alteration of accounting documents may create additional legal problems.

Can the Company Trace Diverted Money?

Financial tracing may identify the original customer payment, the account that received it, later transfers, and the final beneficiary. This process may require assistance from an accountant, financial expert, forensic investigator, and lawyer.

The investigation may examine payments to related companies, transfers to family members, cash withdrawals, unexplained loans, excessive consulting fees, unusual purchases, and transactions that do not correspond to genuine services.

If funds were transferred to another company, the relationship between the entities should be analyzed. Shared directors, employees, addresses, suppliers, customers, bank signatories, websites, or accounting providers may help establish a connection.

The objective is not merely to show that money left the company. It is necessary to explain why the transfer was unauthorized or abusive, who benefited, and what financial loss the company suffered.

Can the Company Request an Injunction?

An interim court measure may be requested where there is a serious risk of continuing revenue diversion, asset transfers, evidence destruction, or unauthorized use of company accounts.

Depending on the circumstances, the company may seek protection concerning specific bank accounts, identified assets, confidential customer information, payment instructions, or ongoing transactions with the receiving business.

The application should be supported by concrete evidence, such as bank records, invoices, customer statements, e-mails, accounting inconsistencies, and related-party documents. Courts generally assess urgency, proportionality, the likelihood of harm, and the strength of the evidence. Security may also be required.

An injunction does not replace the main compensation or recovery claim. It is an urgent protective measure intended to prevent the loss from becoming larger or impossible to recover.

What Recovery Claims May Be Available?

The company may seek compensation for the revenue diverted and any additional loss caused by the conduct. Depending on the facts, the claim may include the amount of unauthorized transfers, lost profits, unpaid receivables, costs of recovering customers, damage to commercial reputation, and expenses caused by the misconduct.

If company property or contracts were transferred below market value, the difference between the fair value and the transfer price may be relevant. If customers were redirected to another business, the company may also assess the value of lost contracts and future revenue.

The company must prove causation. A general decline in sales is not automatically recoverable. The evidence should connect the specific director conduct to the company’s financial loss.

A shareholder’s personal loss must be separated from the company’s loss. If company revenue was diverted, the primary claim generally belongs to the company. A shareholder may need to use corporate procedures or establish a separate legal basis for a direct claim.

Can a Related Company Also Be Responsible?

The receiving business may face liability if it knowingly accepted company revenue, confidential information, contracts, or assets through an unlawful arrangement.

The legal assessment may consider whether the receiving company knew that the director lacked authority, whether it participated in misleading conduct, whether it received payments without a valid commercial basis, and whether it continued benefiting after receiving notice of the dispute.

A claim against the related company may be important because the diverted assets or money may no longer be held by the director personally.

Can the Director Be Removed?

Depending on the company type and governing documents, shareholders may consider removing or replacing the director, changing signing authority, restricting access to corporate accounts, and appointing an independent manager or authorized signatory.

Shareholders may also request corporate records, investigate related-party transactions, challenge defective corporate decisions, and consider a director-liability action.

If the company is controlled equally by competing shareholders, the revenue diversion may create a management deadlock. In that situation, share valuation, exit arrangements, settlement negotiations, or dissolution-related remedies may need to be evaluated.

Can a Criminal Complaint Be Filed?

A criminal complaint may be considered if the facts indicate fraud, breach of trust, unauthorized use of company assets, falsified documents, concealment of money, unlawful data use, or deliberate payment diversion.

A criminal investigation may assist with evidence collection and identification of responsible persons. However, a criminal complaint does not automatically recover the company’s money. Commercial compensation proceedings, interim measures, asset tracing, and corporate actions may also be necessary.

The complaint should include specific dates, transactions, amounts, documents, and explanations of how the company was harmed.

What Can Foreign Shareholders Do from Abroad?

Foreign shareholders living abroad can generally appoint a lawyer to investigate the matter and take legal action in Turkey. A power of attorney may be issued before a consulate or local notary and may require legalization, apostille, and an official translation.

A lawyer can review corporate records, communicate with directors and accountants, preserve electronic evidence, trace payments, request interim protection, commence compensation proceedings, and coordinate civil, commercial, corporate, or criminal remedies.

Lawyer Fırat Fesih Kaya assists foreign shareholders with company investigations, director-liability claims, related-party disputes, asset tracing, and recovery proceedings.

2026 Legal Considerations

In 2026, electronic financial records are often decisive in revenue-diversion disputes. Online banking, electronic invoices, cloud accounting, digital signatures, CRM records, corporate e-mail, and messaging applications may establish the movement of funds and the persons involved.

Companies should maintain clear payment controls, dual approval procedures, conflict-of-interest declarations, financial reporting systems, and restricted access to corporate accounts.

Customer and financial data must be preserved and used lawfully. A company should avoid unnecessary disclosure of personal information while ensuring that relevant evidence is not destroyed.

Frequently Asked Questions (FAQ)

1. What should I do if I suspect that company revenue is being diverted?

Preserve financial and electronic records, restrict unauthorized access, request corporate information, and obtain legal and accounting assistance before confronting the suspected persons.

2. Can a director transfer customer payments to another company?

Only if there is a valid and properly authorized commercial arrangement. Secret, unauthorized, or deceptive transfers may create civil, corporate, and criminal liability.

3. Can a foreign shareholder recover diverted company revenue?

Recovery may be possible through company claims, director-liability proceedings, claims against the receiving entity, and appropriate interim measures.

4. What evidence proves revenue diversion?

Bank records, invoices, customer communications, contracts, accounting entries, e-mails, payment instructions, access logs, and proof of the relationship between the businesses may be important.

5. Can an injunction freeze the receiving company’s assets?

Interim protection may be available in urgent cases, but the court will assess the evidence, risk of harm, proportionality, and applicable procedural requirements.

6. Is a related company automatically liable for receiving money?

No. Liability depends on whether the receiving company knowingly participated in an unauthorized or unlawful arrangement or retained money without a valid legal basis.

7. Can the director be personally sued?

A personal claim may be possible if the director breached management duties, misused company property, acted outside authority, or caused damage through intentional or negligent conduct.

8. Can a criminal complaint recover the stolen money?

A criminal investigation may support evidence collection, but separate commercial or civil recovery proceedings may also be required.

9. Can a foreign shareholder investigate the company without traveling to Turkey?

In many cases, yes. A Turkish lawyer may act under a valid power of attorney and coordinate the investigation and legal proceedings locally.

10. How quickly should a shareholder act?

Immediately. Delay may allow further transfers, destruction of records, customer loss, and dissipation of recoverable assets.

This article is provided for general informational purposes only and does not constitute legal advice. We recommend consulting a lawyer about your specific circumstances to avoid any loss of rights.

Expert Legal Support for Diverted Company Revenue Claims

Expert legal support is essential to avoid loss of rights. By working with a lawyer experienced in director liability, revenue diversion, related-party transactions, corporate investigations, asset tracing, and compensation claims, serving clients throughout Turkey and internationally, you can protect your legal interests.

Fırat Fesih Kaya Law Office provides professional legal support to foreign shareholders and companies facing diverted revenue, unauthorized payments, hidden transactions, director misconduct, asset transfers, injunction applications, and recovery claims.

Phone: +90 312 434 22 22
Mobile/WhatsApp: +90 532 769 22 22
Email: info@firatfesihkaya.av.tr
Address: Mevlana Boulevard No:221, Yildirim Tower No:148, Balgat, Cankaya, Ankara, Turkey