What happened?
In mid-September, redemptions stopped in some funds of two portfolio management companies. With its bulletin dated 17 September 2026, the Capital Markets Board (SPK) closed to trading on TEFAS (Türkiye’s fund distribution platform) the funds founded by the Tera, Pusula, Hedef, Atlas, A1 Capital, Pardus and Bulls portfolio management companies and started the liquidation process. According to information reported in the press:
- 131 funds are covered by the liquidation. According to Central Registry Agency (Merkezi Kayıt Kuruluşu, MKK) data, the number of unique investors is approximately 455,000 and the total fund size approximately TRY 891 billion.
- The liquidation of the Tera Portföy funds is being carried out by Türkiye İş Bankası, and that of the other six companies’ funds by Ziraat Bankası.
- The liquidation period, initially announced as three months, was extended to six months.
- It was announced that the holders of buy and sell orders placed on TEFAS on 17 September and cancelled by the platform will also receive payment from the liquidation balance in proportion to their units in the fund.
- The Istanbul Chief Public Prosecutor’s Office is conducting an investigation into the companies’ managers; police custody and pre-trial detention orders, foreign travel bans and asset freezes have been imposed.
At government level, priority payment to money market fund investors and to those holding units of up to TRY 1 million is being discussed. As of the date of publication of this article, this formula has not been adopted in an official decision.
Will the money in the fund go towards the company’s debts?
No. Article 53 of the Capital Markets Law (SPKn) is clear on this:
- The assets of the fund are separate from the assets of the portfolio management company and of the custodian.
- The fund’s assets cannot be used for any other purpose, even if the management of the company is transferred to a public body. They cannot be attached even for public receivables, no interim injunction can be imposed on them, and they do not form part of the bankruptcy estate.
- When the fund is liquidated, payments can be made only to the unit holders.
In other words, investigations, bankruptcy or attachment proceedings against the company and its managers cannot touch the fund’s own assets. The real problem lies elsewhere: if the actual value of the assets in the fund’s portfolio is lower than the announced price, the amount obtained from the liquidation will be correspondingly lower. The liquidation balance is distributed to investors in proportion to their units.
How do liquidation and payment work?
- The bank acting as liquidator converts the assets in the fund portfolio (government bonds, treasury bills, reverse repos, shares, etc.) into cash.
- The amount obtained is transferred to investors’ custody accounts according to their share of units in the fund.
- Payments may be made in instalments as assets are converted into cash, rather than in a single payment.
At this stage investors do not need to make a separate application; payments are made to the account at the bank or brokerage firm where the units are held. Make sure your account details are up to date.
Will the Investor Compensation Center cover the loss?
Most likely not. The Investor Compensation Center (Yatırımcı Tazmin Merkezi, YTM; SPKn art. 83) is a mechanism that steps in when investment firms, that is, brokerage firms and banks, fail to meet their obligations to pay cash or deliver capital market instruments to their clients. A fall in the value of assets in a fund portfolio is not covered by the YTM under the current rules. This could change if new legislation is enacted.
Whom can you turn to for losses not covered by the liquidation?
If the amount the investor receives at the end of the liquidation is lower than what they invested or than the fund’s last announced value, the following parties may be liable for the difference:
1. The portfolio management company and its managers. Under SPKn art. 55(6), portfolio management companies are obliged to protect the interests of the funds they manage and of the unit holders. Price manipulation, transactions with related parties on non-arm’s-length terms or valuations that do not reflect reality are clear breaches of this obligation. The personal liability of the company’s managers should also be assessed separately.
2. The portfolio custodian. The custodian is obliged to ensure that the unit price is calculated in accordance with the valuation principles and that fund transactions comply with the legislation and the fund’s internal regulation (SPKn art. 56(1)). It is liable to unit holders for losses caused by its failure to meet these obligations (art. 56(2)). The law also preserves the unit holders’ right to sue directly (art. 56(3)). As custodians are usually financially strong banks, this route matters in practice.
3. The bank or brokerage firm that sold the fund. Whether the institution that sold or recommended the fund to you properly explained the product’s risks to the investor and carried out a suitability assessment should be examined separately. The success of this route depends on the specific sales process and the documents.
4. The portfolio management company’s collateral. Collateral deposited by companies in respect of their activities cannot by law be attached or used for any other purpose (SPKn art. 55(4)). How this collateral will be used to cover investor losses is an important part of the process.
In a compensation lawsuit, the competent court, the limitation period and who should be named as defendant vary according to the investor’s situation. For claims based on tort, limitation periods of two years from learning of the damage and the person responsible, and in any event ten years from the act, apply (Turkish Code of Obligations (TBK) art. 72). As the amount of the loss will not be fixed until the outcome of the liquidation is known, the timing of a lawsuit should be planned carefully.
Criminal investigation and the rights of victims
If the allegations are confirmed, the main offences that may be at issue are:
- Market fraud (SPKn art. 107): trading for the purpose of creating a false or misleading impression about prices. Three to five years’ imprisonment; the judicial fine cannot be less than the benefit obtained.
- Aggravated breach of trust (SPKn art. 110(1)(c)): reducing the assets of collective investment schemes through transactions with related persons that are contrary to arm’s-length terms and the rules of good faith. The sentence cannot be less than three years.
- Depending on the facts, aggravated fraud (Turkish Criminal Code (TCK) art. 158) and laundering of proceeds of crime (TCK art. 282).
In this investigation a fund investor has the status of a person harmed by the offence (suçtan zarar gören). In that capacity, they can:
- File a criminal complaint with the prosecutor’s office and take part in the investigation,
- Join the prosecution as an intervening party (katılan) at the trial stage (Code of Criminal Procedure (CMK) art. 237),
- Follow the file and submit evidence through a legal representative.
Evidence gathered in the criminal proceedings, in particular reports of MASAK (the Financial Crimes Investigation Board), expert examinations and findings on money transfers, also provides strong support for a later compensation lawsuit. The asset freezes imposed during the investigation are also important for the prospects of recovering the loss.
What should investors do now?
- Keep your documents: Account statements, purchase receipts, screenshots showing the fund’s last prices, orders dated 16–17 September and cancellation notices, the fund prospectus, the risk disclosure form and any marketing messages sent to you.
- Record your units and their value: The number of units you held on the date the fund was placed in liquidation and their value will form the basis for calculating your loss later.
- Follow official announcements: Treat information other than SPK bulletins, KAP (Public Disclosure Platform) announcements and announcements by the liquidator bank with caution.
- Beware of “we’ll recover your money right away” promises: Do not engage with anyone offering to buy your units below their value or asking for advance payment.
- Wait for the outcome of the liquidation, but do not miss deadlines: Although the loss will only be fixed once the liquidation is complete, there is no need to wait before joining the criminal investigation and preserving evidence.
This article is general information based on publicly available information as of 29 September 2026. As the process is changing quickly, please follow current official announcements.
This article is for general information only and is not legal advice. For your specific situation, please seek advice from a lawyer.