Turkey has ordered a freeze on the assets of former minister Fatma Betul Sayan Kaya and her husband as prosecutors investigate allegations that the couple made millions from an investment fund crisis that has shaken the country’s financial markets.
Prosecutors announced late Tuesday that they had sent a request to relevant institutions concerning the freezing of all assets belonging to Kaya and her husband, Ilyas Kaya. The statement did not provide further details about the investigation or indicate whether either of them had been charged with a crime.
The move comes after the collapse of an investment scheme that Turkish authorities have described as “Ponzi-like” and which has affected hundreds of thousands of individual investors.
The crisis intensified in mid-September when several investment funds were unable to meet requests from investors seeking to withdraw their money. The developments contributed to a sharp fall in Istanbul’s main stock exchange.
A day later, financial regulators ordered seven companies managing 131 investment funds into liquidation. The funds were reported to have combined assets of about $17 billion, while Turkey’s Capital Markets Board, known as the SPK, said more than 455,000 individual investors had been affected.
Kaya, a senior figure in President Recep Tayyip Erdogan’s ruling Justice and Development Party, or AKP, resigned from her position as deputy party chair late Saturday. She previously served as Turkey’s family minister between 2016 and 2018.
Her resignation followed several days of political pressure and allegations from the opposition Yeni Parti concerning her and her husband’s activities in the investment funds at the centre of the controversy.
The opposition party called for an investigation into claims that the couple invested 63 million Turkish lira, then worth about $1.3 million, in April and later sold their holdings in September for approximately 1.3 billion lira, or $26.5 million.
Kaya has denied wrongdoing. In announcing her resignation, she said she was accepting “political responsibility” to allow any investigation into the allegations to proceed independently and impartially.
The allegations have nevertheless intensified political scrutiny over whether investors with access to privileged information were able to profit as the fund crisis developed.
At a news conference on Saturday, Yeni Parti’s Gokhan Gunaydin alleged that Kaya had received insider information and said the opposition would disclose the names of additional people it believes may have benefited from the scheme.
The allegations have not been established in court, and the asset freeze does not by itself establish criminal wrongdoing. Any determination of whether the former minister or her husband benefited illegally from confidential information will depend on the outcome of the investigation.
The case has also added a political dimension to a financial scandal that has already raised concerns among hundreds of thousands of Turkish investors. With regulators moving to liquidate the affected funds and prosecutors examining possible wrongdoing, attention is now turning to how the investment scheme operated, who benefited from it and whether those with political or financial connections had access to information unavailable to ordinary investors.
