Prosecutors in Turkey are investigating whether tipoffs about impending action helped investors withdraw 401.3 billion lira ($8.1 billion) from investment funds before regulators intervened, the Cumhuriyet daily reported on Monday.
The İstanbul Chief Public Prosecutor’s Office is examining transactions by 440 investors between September 1 and 16, seeking to establish whether they acted on information that had not been made public.
Withdrawals from Tera funds totaled 335.9 billion lira ($6.8 billion), involving 168 investors who each withdrew at least 100 million lira ($2 million). Another 272 investors withdrew at least 50 million lira ($1 million) each from Pusula funds, with their withdrawals totaling 65.4 billion lira ($1.3 billion).
The figures represent withdrawals, rather than profits. Investigators are examining their timing and whether investors received advance warning about the investigation or restrictions on their accounts. The withdrawals alone do not establish wrongdoing.
The Capital Markets Board (SPK), Turkey’s securities regulator, ordered the liquidation of 131 investment funds managed by seven companies on September 17, affecting 455,758 investors.
The funds pooled investors’ money to buy securities, but some invested in stocks with few buyers and struggled to sell their holdings as prices fell and investors requested their money back. Prosecutors are investigating suspected share price manipulation.
The inquiry has also led to the freezing of bank accounts belonging to 141 people and 73 companies identified as having earned a combined 187.7 billion lira ($3.8 billion) from funds managed by Tera, Pusula and Hedef. Courts imposed travel bans on the individuals and company managers..
The Savings Deposit Insurance Fund (TMSF), the state agency handling the recovery of these gains, has begun notifying those on the list to return the money for payments to investors who suffered losses.
Prosecutors separately announced an investigation Monday into people who shared documents marked confidential from the fund inquiry on social media, citing a law against violating investigation secrecy.
Vice President Cevdet Yılmaz said Monday that investors would receive payments from fund assets, returned gains and proceeds from assets seized from people and companies implicated in the case, with no public money used.
Nearly 44,000 investors had received payments following the liquidation of funds managed by A1 Capital, Bulls and Pardus, while negotiations continued over whether Atlas funds could be liquidated through the same procedure, Yılmaz explained during an interview with the state-run Anadolu news agency.
A bill awaiting parliamentary approval would allow interim payments of up to 1 million lira ($20,000) based on investors’ net contributions. Previous withdrawals would count toward the recovery of their principal, excluding investors who had already recovered the amount they put in.
A parliamentary committee is due to consider the bill Wednesday. Payments could begin this month if it becomes law, but some funds may lack enough assets to pay the proposed maximum, Yılmaz said.
The government’s handling of the scandal has prompted demands to identify investors who benefited and examine their political connections.
Abdullah Güler, parliamentary group chairman of President Recep Tayyip Erdoğan’s ruling Justice and Development Party (AKP), defended withholding the names of the 214 people and companies Friday, citing privacy protections and the presumption of innocence, the ANKA news agency reported.
“We attach importance to the presumption of innocence,” Güler said.
He urged investors who considered their gains unjustified to return them voluntarily. Under the proposed legislation, a return would not constitute an admission of liability, but would not remove any civil or criminal responsibility arising from unlawful conduct.
AKP lawmakers and their allies in the Nationalist Movement Party (MHP) rejected five opposition proposals Thursday to advance parliamentary inquiries into the scandal, which sought scrutiny of political connections, suspected fraud and whether regulators ignored warnings.
Criticism has also come from former AKP lawmaker Orhan Miroğlu, who accused people pursuing wealth of gaining influence in the party and state institutions. He described the scandal as “the most organized and collective betrayal” in Turkey’s history, Cumhuriyet reported Monday.
An October survey by polling company ASAL Research put AKP support at 31.6 percent, compared with its 35.61 percent share in the 2023 parliamentary election. The main opposition New Party received 25.2 percent, the BirGün news website reported Monday.
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