Turkey seeks asset freeze against former minister amid fund scandal

Turkish prosecutors have moved to freeze the assets of former family minister Fatma Betul Sayan Kaya and her husband, Ilyas Kaya, amid allegations linked to a major investment-fund scandal. In a brief statement late on Tuesday, prosecutors said they had sent a letter concerning the freezing of the couple’s assets to all relevant institutions. The move follows the collapse of an investment scheme that officials have described as “Ponzi-like”.

Kaya, a senior member and deputy head of President Recep Tayyip Erdogan’s ruling AKP, resigned at the weekend after days of speculation about her alleged links to the crisis. She acknowledged no wrongdoing, saying she was taking political responsibility so that an investigation could proceed independently and impartially. Turkey’s main opposition Yeni Parti has sought clarification over claims that Kaya and her husband invested 63 million lira, or about $1.3 million, in April and later sold their shares for roughly 1.3 billion lira, equivalent to $26.5 million.

Yeni’s Gokhan Gunaydin alleged that Kaya had received insider information and said the party would identify more people connected to the affair. The source material does not state that prosecutors have established the allegations. The crisis began in mid-September when several funds reportedly could not meet investor redemption demands.

Turkey’s main stock exchange subsequently fell, and regulators placed seven companies holding 131 investment funds into liquidation. The Capital Markets Board said more than 455,000 individual investors were affected. The funds’ assets were reportedly worth around $17 billion.

Erdogan held a three-hour meeting with economic aides on Tuesday to discuss the scandal. Earlier, he defended the record of the AKP, saying opponents could not tarnish the party’s reputation. The prosecutors’ asset-freezing request is part of the continuing official response; no outcome of the investigation was provided.