Two executives face detention orders in fund probe

ISTANBUL

Istanbul prosecutors on Sept. 19 have ordered the detention of Pusula Portföy executive Serdar Turhan and Tera executive Alper Öztürk in an investigation into capital market transactions.

Four suspects had previously been remanded in custody in the investigation. Travel bans and asset freezes were also imposed on 51 people.

The latest orders follow regulatory intervention after Pusula and Tera disclosed defaults on payments to investors seeking to redeem their fund holdings.

Atlas Portföy also reported payment delays at a money market fund.

On Sept. 17, the Capital Markets Board (SPK) halted trading in funds run by seven asset managers on TEFAS, Türkiye’s electronic fund trading platform.

A total of 131 funds have been ordered into liquidation.

İşbank was assigned to oversee the liquidation of the affected Tera funds, while Ziraat Bank will handle those of the other six companies.

Cash from asset sales and maturing investments will be distributed in proportion to investors’ holdings, at intervals determined by the banks.

Outstanding payments from unfulfilled TEFAS redemption orders will be settled first.

The SPK set a three-month liquidation period, which it can extend. The affected funds are closed to purchases and redemptions through both TEFAS and other distribution channels.

The Central Bank pledged to increase funding through one-week repo auctions and reduce collateral haircuts. The banking regulator also temporarily eased capital rules for listed banks buying back their own shares.

The Financial Stability Committee described the fund problems as “temporary and manageable” on Sept. 17 and pledged measures to ease the liquidity squeeze and prevent contagion.

Treasury and Finance Minister Mehmet Şimşek said on Sept. 18 that the difficulties were confined to a limited number of funds, with 90 percent of the market functioning normally.

“There is no widespread systemic risk,” he said. “We have quarantined the troubled segment.”