Turkish authorities liquidate investment funds amid market manipulation probe

On September 17, Turkish authorities ordered the liquidation of 131 investment funds, managed by seven portfolio management companies, following a sharp stock market sell-off. The Capital Markets Board (SPK) confirmed that 455,758 individual investors are affected, with total assets involved estimated at approximately $18 billion. To stabilize the financial sector, regulators have implemented measures to boost lira liquidity and adjust capital and margin requirements.

The crisis stems from alleged stock market manipulation involving shares of companies such as Katilimevim, Gundogdu Gida, and Destek Finans. These transactions reportedly created a false perception of rapid gains to attract retail investors. In response, prosecutors have launched a widening investigation into the matter. Reports indicate that five individuals have been detained and subsequently jailed pending trial by a court as of September 23.

The SPK has advised investors to disregard unofficial reports and rely on official communications as the investigation proceeds. While authorities work to restore market confidence, the fallout has triggered significant concern regarding the protection of retail investor rights and the stability of the Turkish capital markets.