Turks to indict Nadir administrators

THE Turkish government is to prosecute three of Britain's leading accountants for alleged criminal misconduct in administering the collapsed businesses of the disgraced tycoon Asil Nadir.

In an unexpected move, with unpredictable diplomatic consequences, the director of public prosecutions in Istanbul has issued proceedings against Richard Stone, a senior partner at Coopers & Lybrand, Britain's largest accountancy; Michael Jordan, who recently retired as a partner at the same firm; and Christopher Morris, senior partner at Touche Ross. The case is due to be heard within three months. If convicted, the three could be fined or imprisoned for up to seven-and-a-half years.

The Foreign Office, which said last night that it was not aware of the proceedings, confirmed that Turkey and the UK do have an extradition agreement, under the terms of the European Convention on Extradition.

The Turkish government has not indicated whether it plans to apply for extradition. 'We are surprised to hear the news (of the prosecution),' a Foreign Office spokesman said. 'Obviously we need to know how seriously they mean it.'

If Turkey does decide to pursue the UK-based administrators, it could sour relations with Britain. Turkey has so far declined to agree that it would extradite Nadir if he visited the country.

Nadir fled the UK last year facing charges of theft and false accounting involving more than pounds 30m. He is currently in northern Cyprus, which Turkey recognises as an independent state.

Coopers confirmed last night that it had been made aware that criminal proceedings had been initiated in Istanbul. A spokesman, who described the move as 'outrageous', said: 'This action has been initiated by Asil Nadir in order to create further difficulties and delay the progress of the administration.' He felt it was no coincidence that earlier this week the administrators had won an important legal action in Ankara against Nadir.

Michael Jordan was detained last year while in Istanbul and ordered to appear in court following a complaint from Nadir, who alleged that he had tried to bribe Turkish officials.

The detention order was cancelled and Mr Jordan was allowed to leave the country. It later transpired that an internal Coopers & Lybrand memo had referred to the payment of 'bribes' in a discussion of business in Turkey. Coopers said that this was an administrative error.

This new action represents a more serious challenge to the work of the Polly Peck administrators, who are trying to realise company assets for shareholders. Ahmet Sitki Alkan, the Istanbul prosecutor, confirmed last night that the three are to face trial within three months and can be convicted in their absence if they fail to attend voluntarily.

Nadir's lawyers in Istanbul deny that they initiated the charges or used their influence to persuade the prosecutor to bring them. They claim, as does the prosecutor, that they arose from an independent state investigation that followed Nadir's original complaint. The substance of that allegation - that the administrators had given bribes - is not among the charges the three face.