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      Turkey Orders Liquidation of 131 Investment Funds Amid Allegations of Fraud

      Turkey's Capital Markets Board has ordered the liquidation of 131 investment funds, impacting approximately 350,000 investors and involving assets worth $18.3 billion. This decision, announced on September 17-18, comes in response to significant redemption pressures and allegations of share-price manipulation that have raised concerns about Ponzi-like practices within these funds.

      The funds, managed by seven companies including Tera Portföy and A1 Capital, reportedly engaged in a strategy that inflated stock prices through concentrated investments in illiquid assets. As investors began to withdraw their funds, the underlying stocks could not sustain the selling pressure, leading to massive outflows that reached $1 billion in a single day. The Capital Markets Board has since suspended trading in these funds and initiated criminal complaints against several individuals involved in the alleged manipulation.

      In light of the crisis, Turkey's benchmark BIST 100 index experienced a decline of 6% to 8%. To manage the liquidation process, the Capital Markets Board appointed Isbank, Turkey's largest private bank, and state-run Ziraat Bank to oversee the conversion of the funds' holdings into cash, with a target of distributing proceeds to investors within three months. Finance Minister Mehmet Şimşek has attempted to reassure the public, framing the situation as an isolated incident rather than indicative of broader systemic risks in Turkey's financial system.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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