Prosecutors in Istanbul have asked a court to jail 11 suspects in a new phase of the criminal investigation linked to Türkiye’s investment fund crisis, Hürriyet reported late on Thursday. Four more suspects were referred to the court with a request for house arrest, and police are still looking for five people.
The new step came hours after parliament passed a law on the liquidation of the troubled funds, which clears the way for interim payouts of up to 1 million lira to investors.
Four listed companies under scrutiny
The investigation is run by the Istanbul Chief Public Prosecutor’s Office through its bureau for terrorism financing and money laundering crimes. According to Hürriyet and the state-run Anadolu Agency, this phase is based on reports from the Capital Markets Board (SPK), Türkiye’s market regulator, and on written complaints about trading in the shares of four companies listed on Borsa Istanbul: Işıklar Enerji ve Yapı Holding (IEYHO), Vişne Madencilik (VSNMD), Odine Solutions Teknoloji (ODINE) and Tera Finansal Yatırımlar Holding (TRHOL).
Detention orders were first issued for 31 people, and police caught 26 of them, Anadolu Agency reported. Five more suspects were later detained under new orders. By Thursday evening, 16 suspects had been taken to the Istanbul courthouse and the remaining 15 were still giving statements at police headquarters.
Of those sent to court, 11 were referred to a criminal judgeship of peace with a request for arrest, and four with a request for judicial control in the form of a ban on leaving their homes. The court had not ruled on the requests when the reports were published. All suspects are presumed innocent unless convicted by a court.
Other companies named in the file include the portfolio managers Atlas Portföy, A1 Capital Portföy, Pardus Portföy and Tera Portföy, the brokerage Alnus Yatırım, the real estate firm Pirnus Yapı Gayrimenkul and the venture capital trust Hedef Girişim. The reports did not say which offences the suspects are accused of.
A crisis that began in September
The fund investigation started in late September with allegations of suspicious trading in funds and shares that prosecutors say produced unjust gains. By 26 September, 51 people had been arrested, including a former deputy governor of the central bank, NTV reported at the time. Assets of suspects and their relatives, including luxury cars and private jets, were seized.
The SPK then moved to liquidate 131 funds run by seven portfolio management firms, with about 455,000 investors. The regulator said this week that the number of funds still in liquidation had fallen to 47 and that payouts had reached 49.7 billion lira. Finance Minister Mehmet Şimşek has said that gains above 10 million lira will be targeted for refunds, with small investors paid first.
What it means for foreign investors
The affair has weighed on confidence in Turkish markets. Borsa Istanbul’s main index fell about 3% on Thursday, the day of the central bank’s rate cut, as foreign investors kept selling. Foreign residents who keep savings in Turkish mutual funds, often bought through bank apps and the TEFAS fund platform, should check whether their fund is managed by one of the firms in liquidation and follow SPK announcements on payouts. For a wider view of household budgets and finances, see our cost of living in Türkiye guide.
Sources
- Fon soruşturmasında yeni gelişme: 11 şüpheliye tutuklama talebi (Hürriyet)
- İstanbul’daki sermaye piyasası işlemleri soruşturmalarında 5 gözaltı daha (Anadolu Ajansı)
- Fon soruşturmasında tutuklu sayısı 45 oldu (NTV)
Photo: Nicholas Cappello / Unsplash License, via Unsplash
