Another suspect detained as Turkish authorities continue fund probe

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Key takeaways

Erdin Özel, chairperson of Tera Portföy, was taken into custody in a widening investment fund probe.
Prosecutors are analyzing 131 investment funds held by seven companies over suspected share price manipulation.
Authorities requested financial and crypto transfer data concerning executives from several financial holdings.

Another suspect was detained in a widening probe into an alleged investment fund scheme that impacted the Turkish capital market and stocks in recent weeks, a report indicated on Sunday.

As part of the investigation, Erdin Özel, the chairperson of the board of Tera Portföy, for whom an arrest warrant had been issued, was taken into custody, an Anadolu Agency (AA) report said.

Investigations into transactions carried out in the capital markets are continuing under the Istanbul Chief Public Prosecutor's Office’s Bureau for the Investigation of Terrorist Financing and Money-Laundering Crimes, the report added.

Investigation into investment funds and stock manipulation

Prosecutors have been analyzing the operations of 131 investment funds held by seven companies as part of the investigation launched earlier this month on suspected share price manipulation in thinly traded stocks, which has led to investor withdrawals and a slump in the benchmark stock index.

Authorities took a series of steps to support financial stability, reiterating that the risk is tied to a specific segment of the market and that there is “no structural problem” in the markets.

An arrest warrant had also previously been issued for Emir Münir Sarpyener, CEO of Tera Yatırım, the AA report said.

Requests for financial and crypto data

In a letter sent by the Istanbul Chief Public Prosecutor’s Office to the Financial Crimes Investigation Board (MASAK) on Sept. 17, the office requested financial data concerning the executives of Pusula Finans Holding Inc., Tera Yatırım Menkul Değerler Inc., Hedef Holding Inc. and Bulls Yatırım Menkul Değerler Inc., as well as their subsidiaries.

The prosecutor’s office requested that the full identification details of all company executives be established and that raw data concerning their transfers of money and crypto assets abroad from 2024 to the present, as well as all incoming and outgoing financial transactions, be sent to the Chief Prosecutor’s Office.

As part of the investigation, a number of top executives have been arrested so far.

Political repercussions and official statements

Meanwhile, Fatma Betül Sayan Kaya, a former minister and Justice and Development Party (AK Party) deputy chair, announced late Saturday in a social media post that she has requested to be relieved of all her duties within the party, citing a recent issue and “various claims” concerning her.

Her resignation came amid speculation over alleged links to the fund withdrawals investigation, which emerged earlier this month.

On Sunday, AK Party spokesperson Ömer Çelik said that “every aspect and detail of the issue referred to as the 'fund crisis' has been meticulously monitored and evaluated,” reiterating President Recep Tayyip Erdoğan's statement that “anyone found responsible will be held accountable.”

“Nothing will remain in the dark, and the necessary actions will be taken. If there is an allegation, it will be investigated,” Çelik wrote in a statement on Turkish social media platform NSosyal.

“All irregularities will be brought to light. Those who have committed wrongdoing will be held accountable before the law,” he added.

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