Turkey Should Come Under Scrutiny for Dealings With Iran, Says Think Tank

Turkey could become a major problem for the Obama administration if it continues to turn a blind eye to the country's shady financing deals, an influential foreign policy think tank warns in a new report.

Turkish Prime Minister Recep Tayyip Erdogan should come under more scrutiny for his country's business deals with Iran as well as several other financial arrangements, the Foundation for the Defense of Democracies, a Washington-based group, argues. This comes at a time when the U.S. has been reluctant to interfere with a domestic scandal involving bribery and fraud

President Barack Obama and Turkish Prime Minister Recep Erdogan arrive for a joint conference in the Rose Garden of the White House in Washington, May 16, 2013. Saul Loeb/AFP/Getty Images.

, a scandal in which Erdogan and members of his inner circle, including his son, are involved.

"The corruption scandal has been grabbing headlines in Turkey and the U.S. has made it pretty clear that this is seen as a domestic issue," Dr. Jonathan Schanzer, vice president of research at the foundation and author of the report, told ABC. "But what we have noted is that a good number of these corruption stories have intersected with terrorism finance concerns."

Among the other major problems Schanzer identified in his report, which goes public Friday, are Turkey's funding of some radical Syrian opposition groups; Erdogan's meetings with the Palestinian political group Hamas, a U.S.-designated terrorist organization; and the fact that Turkey was almost blacklisted by an international body monitoring terrorism finance, the Financial Action Task Force.

What makes Turkey so different from other allies to which the U.S. can turn a blind eye, Schanzer pointed out, is the fact that it is a NATO ally and is trying to gain admission into the European Union. Because of its Western leanings, the country has long been considered a firewall against Islamist extremism, something that is now at risk, he argued.

"The goal here is to prevent Turkey from continuing to slide in a very dangerous direction," Schanzer, a former terrorism finance analyst at the Treasury Department, said.

The report comes as a group of more than 80 foreign policy experts and former officials wrote a letter Thursday urging President Obama to take a tougher tone with Erdogan, focusing on anti-democratic actions that include his tough treatment of protestors last summer.

The authors of both the letter and the new report expressed concern that the Obama administration has been publicly reluctant to interfere with Turkey's domestic politics, even as it likely has global implications.

President Obama did speak with Erdogan on Wednesday, and in a readout of the call the White House alluded to the possibility that he may have brought up Turkey's financial dealings: "The President noted the importance of sound policies rooted in the rule of law to reassure the financial markets, nurture a predictable investment environment, strengthen bilateral ties, and benefit the future of Turkey."

But last month, Secretary of State John Kerry sent a clear hands-off message, at least when it comes to domestic issues, saying in a press conference with his Turkish counterpart Ahmet Davutoglu, "The United States of America has absolutely no interest in being caught up in or engaged in or involved in the internal politics, the election process of Turkey."

Schanzer said he's hopeful the White House will raise its voice louder with Turkey if enough critics make their concerns known, including, he said, members of Congress who might consider holding hearings on the issue.

"Am I optimistic that we're going to see movement on this right away? No. Are there things that we can do in the interim? Absolutely," he said.

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