Turkey orders 131 funds from seven managers wound down after warnings some could miss payouts

Some of the funds traded shares in small companies that had only recently listed, according to Reuters reporting carried by mezha.net ^[5]. Those stocks had few buyers and sellers. Their prices could move fast, and the moves lifted the daily returns of the funds holding them ^[5]. Run the same path backwards and you get the payout problem. To pay a departing investor, a fund has to sell, and a thin market is one with few buyers. Several funds also held mostly one stock or one asset ^[3]. Paying out of those funds means selling that one position.

Tera Portfoy's TLY fund is the clearest case in the record. It returned 747% in lira from January to July 2025, while it had fewer than 200 investors ^[12]. It opened to a wider pool in July, and by September its cumulative return had passed 15,000% in lira ^[13]. It grew to 102,616 investors and $5bn, the largest of the funds being wound down ^[14]. The investor base grew more than 500-fold on a record set by fewer than 200 holders ^[2].

Treat the 15,000% like any benchmark figure. It puts a unit at more than 151 times its starting value in lira ^[3]. For that to become cash, buyers have to take the fund's holdings at or near the prices that produced it. The liquidation sells into a market whose main index just had its worst month since 2008 ^[4].

TP2, Tera's money market fund, held $4.6bn for about 167,000 investors ^[15]. It returned 123% while inflation ran at 60% ^[16]. That is a real return of about 39% ^[4]. I would want to see the holdings before calling that a money market result.

The money is concentrated across funds as well as inside them. TLY and TP2 together hold $9.6bn, up to 48% of the assets in all 131 funds ^[1]. Their investor counts add to about 270,000 against nearly half a million overall, though one saver can appear in both ^[7].

The managers grew the same way. Capital Markets Board data put Turkey's portfolio management market at $329bn in August 2026, up from $246bn a year earlier ^[9]. That is growth of about 34% ^[5]. Over the same year Tera's assets rose more than tenfold to $14.3bn and Pusula Portfoy's 13-fold to $13.2bn ^[10]. Together that is $27.5bn, about 8% of the market ^[6]. Neither firm responded to requests for comment ^[11].

The warnings were public. In November 2025, Finance Minister Mehmet Simsek said manipulation was running partly through certain funds and that regulatory gaps would be closed ^[7]. In the Ukrainian rendering mezha.net published, he said the manipulations were known to be carried out in particular through certain funds ^[6]. Omer Gonul, then chairman of the Capital Markets Board, said regulators were watching funds used to get around the rules. He said their managers could face sanctions up to losing their licenses ^[8]. The wind-down order came in September, after warnings that some funds might not be able to pay investors ^[1].

The record supports the payout-risk reading. It also documents a manipulation investigation that regulators have widened across the stock and fund markets ^[17]. Justice Minister Akin Gurlek said the number of suspects had risen to 217, with 56 held before trial ^[17], among them executives linked to Tera and Pusula ^[18]. Broadcaster NTV reported the arrest of Erkan Kilimci, a former deputy central bank governor who later worked at Tera ^[19]. Before the arrest, he wrote that he regretted being named because of a Tera post he held for three months ^[20].

The report does not say how or when investors will be paid. Istanbul's main index rose 2.5% on Thursday, October 1 ^[21].