New arrests made in Turkey in high-profile financial manipulation case

A high-profile investigation into a case of financial manipulation on the stock market is continuing in Turkey.

The number of arrested suspects has reached 120 people, among them former high-ranking officials, top bank executives, and major businessmen.

As part of the latest stage of the investigation, the court arrested:

Yunus Arınç — former general director of Takasbank and former head of the State Supervisory Council under the President of Turkey (DDK);

Ömer Murat Gülkan — chairman of the board of directors of Kapital (OMG Capital Advisors);

Ali Paslı — co-founder of Adil Katılım Bankası.

Four more suspects — major entrepreneurs and top executives — have been placed under house arrest as a preventive measure.

The scandal erupted in August–September, when Turkey's Capital Markets Board (SPK) detected an anomalous rise in the value of a number of investment funds due to artificial cross-trades involving low-liquidity shares.

The crisis affected more than 455,000 investors. The regulator decided on the liquidation (tasfiye) of 131 investment funds.

The authorities identified 214 individuals and legal entities that withdrew suspicious assets. The total amount of illegally obtained profit is estimated at 187.6 billion Turkish lira.

The government created a Special Coordination Council, and parliament passed a bill on paying compensation to affected investors (up to 1 million lira per person).

The investigation quickly went beyond the financial sector and affected the country's political and bureaucratic elite. Among those arrested earlier:

Fatma Betül Sayan Kaya — former minister of family and social policy (her husband was released on his own recognizance after returning 1.86 billion lira in income to the treasury);

BDDK Deputy Chairman Muhammet Erişen, former Borsa Istanbul General Director Korkmaz Enes Ergün, as well as a number of SPK and BDDK executives.

Top executives of Pusula Portföy, Tera Yatırım, Türkiye Sigorta, and Altınbaş Holding.

At the moment, investigative actions and the process of liquidating the problematic funds are continuing under the supervision of the Capital Markets Board and the Savings Deposit Insurance Fund (TMSF).

Source: Haberler