Turkey fund scandal: ex-regulator chief faces probe

Turkish Finance Minister Mehmet Simsek agreed to let prosecutors open an investigation into Ibrahim Omer Gonul, the former head of Turkey's Capital Markets Board, state news agency Anadolu said Wednesday.

The move came two weeks after prosecutors requested authorisation to investigate Gonul, who chaired the regulator for four years until his mandate ended in April.

In a letter to the ministry, prosecutors said there were clear and sufficient indications that Gonul had failed to fulfil his responsibilities while in office.

Turkey has been dealing with the fallout from an investment fund scandal that began about a month ago and led to an investigation into allegations of widespread market manipulation.

The crisis began when several funds were unable to meet investor redemption demands. The Capital Markets Board placed seven companies that manage 131 investment funds into liquidation. Those funds had assets reportedly worth about $17 billion, and the regulator has said more than 455,000 individual investors were affected.

The scandal has also put pressure on President Recep Tayyip Erdogan's ruling AKP. One senior party official resigned after allegations about her investment activities.