Turkish prosecutors and the country’s securities regulator are examining trading in 31 companies’ shares for suspected market manipulation amid Turkey’s investment fund scandal, the Ekonomim news website reported on Saturday.
Investigators suspect funds were used to drive up share prices, increasing the funds’ apparent value and misleading investors.
Nine people have paid just over 2 billion lira ($40 million) into a voluntary repayment account administered by the Savings Deposit Insurance Fund (TMSF), the state agency tasked with recovering assets, the report added.
The crisis erupted in mid-September when some investment funds, which pool investors’ money to buy shares and other assets, could not meet withdrawal requests amid investigations into suspected market manipulation.
The Capital Markets Board (SPK), Turkey’s securities regulator, ordered the liquidation of 131 funds managed by seven companies on September 17, requiring their assets to be sold or distributed to repay investors.
Those funds had 455,758 individual investors, some of whom have since received payments.
Liquidation has been completed for 66 funds managed by A1 Capital, Bulls and Pardus, with more than 45,000 investors receiving cash and assets worth approximately 40.8 billion lira ($823 million), the government announced Sunday.
That leaves 65 funds still undergoing liquidation.
Fund manager Hedef Portföy on Monday outlined the payment arrangements for its 31 funds, which have been moved from an interim payment scheme to liquidation under the rules applied to A1 Capital, Bulls and Pardus.
Payment amounts and dates will depend on assets being converted into cash and accounts being finalized, the company explained.
A repayment bill that cleared a parliamentary committee Wednesday is expected to reach the full legislature this week.
It would allow interim payments of up to 1 million lira ($20,000) per eligible investor, depending on available assets, with payments coming from fund holdings and recovered money without Treasury funding.
The SPK on Friday also sought the prosecution of 37 people over suspected stock market manipulation, among them a former ruling party lawmaker and a former deputy governor of Turkey’s central bank.
The investigation has reached former family minister Fatma Betül Sayan Kaya and her husband, who were questioned as suspects and denied wrongdoing.
President Recep Tayyip Erdoğan’s ruling Justice and Development Party (AKP) and its ally, the Nationalist Movement Party (MHP), have rejected opposition demands for a parliamentary inquiry into political connections and regulatory failures behind the scandal.
Coverage questioning government figures’ connections to the scandal has also brought penalties, with the Radio and Television Supreme Council (RTÜK), Turkey’s broadcasting regulator, fining Sözcü TV and Koza TV on Friday.
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