Turkey's $20 billion fund crisis in foreign media: Uncertainty continues for 455,000 investors

The investment fund crisis that erupted in Turkey in mid-September has entered the international media spotlight as the liquidation process begins and the investigation expands. Al-Monitor has examined the liquidation of 131 funds, which concern more than 455,000 investors and have a reported total asset size of approximately $20 billion.

The most critical question following the liquidation decision taken by the Capital Markets Board (SPK) on September 17 is how much of their money investors will be able to recover and on what timeline. The report emphasized that the announced asset size does not directly reflect the amount initially invested by investors or the money that might be returned at the end of the liquidation.

According to Al-Monitor, the crisis became visible when funds managed by certain companies, including Tera Portföy and Pusula Portföy, struggled to meet investors' withdrawal requests. It was noted that the process is not limited to investor losses; it has also sparked debate due to market oversight issues, previous warnings about manipulation, and allegations of political connections.

LIQUIDITY RISK IN LIQUIDATION

One of the prominent points in the analysis was that some funds held large positions in companies with low trading volumes and low free-float ratios. East Capital portfolio advisor Emre Akçakmak pointed out that in addition to liquid assets such as cash and bonds, fund portfolios also contained shares of small companies that are much harder to sell.

According to Akçakmak, the rapid depreciation of such shares during the liquidation process could be decisive for the repayment schedule and amount. The expert also noted that reported fund values may have been inflated in the past, stating that the decline in asset value should not be read entirely as realized cash loss.

GlobalSource Partners Turkey analyst Atilla Yeşilada painted a bleaker picture. Based on the assessments of two experts he trusts, Yeşilada said that for some troubled assets, investors recovering even 20 cents on the dollar of their invested money could be an optimistic scenario. Al-Monitor specifically noted that this estimate is not based on a completed asset valuation.

POLITICAL ALLEGATIONS AND PRIOR WARNINGS

The report also covered the political repercussions of the investigation. It was reported that AK Party Deputy Chairperson Fatma Betül Sayan Kaya resigned from her post on September 27 following allegations that she had profited from certain stocks using insider information before the collapse of the funds.

Citing reports in the Turkish press based on prosecution documents, Al-Monitor also wrote that a restriction was placed on the assets of Mustafa Yazıcı, son of AK Party Deputy Chairperson Hayati Yazıcı, on September 30, and that this decision was lifted on the same day. Hayati Yazıcı, for his part, defended that his son's commercial activities were in accordance with the law and requested an investigation into the allegations.

Former Minister of Economy Nihat Zeybekci also told Sözcü that the money of four companies in which he is a partner remained in Tera's TP2 fund. While stating that the investments were made without his knowledge, Zeybekci argued that state institutions were negligent in the process.

Warnings prior to the crisis were also given extensive coverage in the analysis. It was recalled that Minister of Treasury and Finance Mehmet Şimşek publicly stated in November 2025 that manipulation was being carried out through certain funds, and that MSCI pointed to concerns about coordinated trading in funds linked to some small Turkish companies during its market classification review in June 2026.

According to the SPK's own chronology, the institution detected price movements originating from funds that could not be explained by the companies' fundamental indicators in late 2025. The issue was addressed at the Financial Stability Committee in December 2025, and a working group was formed within the SPK. Despite this, the steps taken throughout 2026 were not enough to prevent the collapse in September.

Experts are of the opinion that the crisis has not spread to the entire fund market in Turkey. Economist Murat Sağman stated that there are problems in less than 10 percent of the approximately $200 billion fund market; 131 funds were affected out of more than 2,600 funds.

Nevertheless, it is emphasized that for trust to be restored in the market, the liquidation process must be conducted transparently, liquidity must be protected, and a clear roadmap must be presented to investors. It is assessed that if allegations of political connections receive more coverage in global financial media, foreign investors may approach Turkish markets with caution.

News Source: 12punto