* Gulen in self-imposed exile in Pennsylvania since 1999
* Erdogan accuses him of building "parallel state"
* Erdogan also criticises German president (Adds comment from U.S. official, Gulen-affiliated movement)
By Gulsen Solaker
ANKARA, April 29 (Reuters) - Prime Minister Tayyip Erdogan said on Tuesday he would ask the United States to extradite an Islamic cleric he accuses of plotting to topple him and undermine Turkey with concocted graft accusations and secret wire taps.
Such a move against Fethullah Gulen, whose followers say they number in the millions, would be possible only if Turkey first issued an arrest warrant and produced evidence of a crime, according to one legal expert.
But it would be arguably Erdogan's most decisive move yet in a power struggle that has posed one of the biggest challenges of his 11-year rule.
Gulen has lived in self-imposed exile in Pennsylvania since 1999, when secularist authorities raised accusations of Islamist activity. Since then he has moved from being a close ally of Erdogan to his most powerful political enemy.
Asked by a reporter at parliament if a process would begin for Gulen's extradition, Erdogan said: "Yes, it will begin."
In an interview with PBS talk show host Charlie Rose broadcast late on Monday, Erdogan said Gulen may also pose a threat to U.S. security by his activities.
"These elements which threaten the national security of Turkey cannot be allowed to exist in other countries because what they do to us here, they might do against their host," Erdogan told Rose in the interview, according to a transcript.
Erdogan, whose ruling AK Party traces its roots to political Islam, accuses him of building a "parallel state" of followers in institutions such as the police and judiciary and using them in an attempt to seize the levers of state power.
Gulen denies engineering a police graft investigation which has seen three cabinet ministers quit, but has denounced Erdogan over moves to shut down the inquiry by purging police and judiciary of his followers.
Erdogan has drawn accusations of increasing authoritarianism with his response to the graft investigation, which has included removing thousands of police officers and hundreds of judges and prosecutors, as well as imposing a two-week ban on Twitter and broadening the powers of the state intelligence service.
Human Rights Watch on Monday criticised a new law giving the national intelligence agency (MIT) more scope for eavesdropping, greater immunity from prosecution for top agents and jail terms for leaks of sensitive information, saying it gave the agency "carte blanche" and was open to abuse.
The government has said the law replaces outdated legislation and brings Turkey in line with international norms.
German President Joachim Gauck criticised Erdogan's leadership style during a trip to Turkey on Monday and warned against curbing freedom of expression.
"Presumably he still thinks he is a clergyman," Erdogan said of the former Lutheran pastor, adding his remarks showed a lack of statesmanship and that he was "saddened" by his attitude.
"Houses belonging to Turks are burnt down with racist motivation (in Germany), then they come here to give us advice. Keep your advice to yourself," he said.
Erdogan said Turkey had complied with more than 10 extradition requests from the United States and now expected the same response from its NATO ally.
But Turkish authorities would first need to issue an arrest warrant for Gulen and produce evidence he has committed a crime, according to a 1979 treaty signed between the two countries.
"If he was tried in Turkey and had been convicted, then you can send that court ruling. You can request extradition for the implementation (of that sentence)," said former European Court of Human Rights judge Riza Turmen, a deputy from the main opposition Republican People's Party.
"But none of these are currently the case," he told Reuters.
The 1979 treaty also exempts all crimes of a "political character" unless they can be shown to have targeted either the head of state or head of government, or their families.
Erdogan said Turkey had cancelled Gulen's passport and that he was in the United States as a legal resident on a green card.
"As a matter of longstanding policy, the Department of State does not comment on pending extradition requests or confirm or deny that an extradition request has been made," a U.S. embassy official said.
U.S. Ambassador Francis Ricciardone told the Hurriyet daily this month that Turkish officials in Ankara had mooted Gulen's forcible return but there had been no formal request.
Gulen runs a network of businesses and schools, well-funded and secular in nature, across the world. The schools are a major source of influence and funding and have become the target of government efforts to shut them down.
"Since there is no current case against (Gulen), extraditing him would not comply with international legal principles. The comments about extradition appear to (be) for domestic politics," said Tercan Ali Basturk, secretary general of the Journalists and Writers Foundation, a Gulen-affiliated group in Istanbul.
Erdogan accuses Gulen of contriving criminal allegations that his son and the children of three ministers were involved in a corruption scandal and took billions of dollars of bribes. He also accuses Gulen's movement of bugging thousands of phones and leaking audio recordings, which the cleric has denied.
Turkish officials have said an investigation is underway.
"If there is due process, we have nothing to fear because we haven't done anything constituting a crime," Basturk said.
"If there is no due process, everyone should be afraid as it means anyone who doesn't think like Erdogan is at risk." (Additional reporting by Ayla Jean Yackley and Daren Butler in Istanbul, Jonny Hogg in Ankara; editing by Ralph Boulton; Writing by Nick Tattersall; Editing by Ralph Boulton)
Turkey's Erdogan Says He Will Try To Extradite Rival From The U.S