Turkey arrests 45 over investment fund crisis

Turkish police have arrested 45 suspects in an investigation into an investment fund crisis, officials said Friday, as Finance Minister Mehmet Simsek denied speculation that he would resign.

Justice Minister Akin Gurlek said prosecutors were investigating 76 suspects and that 45 had been arrested. Media reports said one of those arrested was Erkan Kilimci, a former deputy governor of Turkey's central bank.

Prosecutors are examining the operations of 131 investment funds held by seven companies, whose assets are reportedly worth around $17 billion.

Gurlek said authorities had seized the assets of people who owned or managed the now-liquidated investment funds, as well as assets belonging to their immediate family members.

The crisis began in early September after Turkey's Capital Markets Board changed its guidelines for investment funds, saying they could no longer invest all their assets in one stock and had to diversify. The move was aimed at concerns that many funds were investing in a small number of obscure or hard-to-sell stocks.

Funds began selling stocks to comply, alarming investors who tried to cash in their investments. Several companies later admitted they could not meet investor redemption demands, and Istanbul's main stock exchange fell. A day later, the Capital Markets Board placed all 131 investment funds into liquidation and said more than 455,000 individual investors were affected.

Simsek rejected rumours that he was preparing to step down. “The allegations circulating about my resignation are baseless,” he wrote on X late Thursday, saying the public should not heed speculative news that he said was intended to undermine economic stability.

Gurlek said investigators were working to determine who was responsible. “No one is being shielded, and no one is receiving preferential treatment,” he said.