High-profile Turkish investment funds Pusula and Tera Crisis triggered widespread market panic among retail investors who had been attracted by extraordinary reported returns, according to Bloomberg Markets. The crisis escalated across the week of 16–18 September 2026, with Turkish authorities detaining executives at Tera and Destek and imposing travel bans on others as part of a criminal investigation into mass fund outflows. Turkey's market regulator also filed criminal complaints against dozens of individuals for alleged share-price manipulation by asset managers.
Turkish equities fell more than 5% amid the turmoil, as an asset manager failed to meet redemption requests and investors withdrew approximately $1 billion in funds. The sell-off erased approximately $4 billion from the wealth of businessman Altunc Kumova following a sharp decline in a Turkish finance firm's stock.
The XU100, Turkey's main equity index, fell sharply as liquidity stress spread across the fund industry. The Turkish lira (TRY) was also affected, given its direct exposure to capital outflows from domestic asset managers under investigation. MSCI separately raised the prospect of reclassifying Turkey from emerging market to frontier market status, citing concerns about coordinated trading activity by fund managers.
Turkey's regulator announced the liquidation of funds managed by seven asset management firms, including Tera Portfoy and Pusula Portfoy, and enlisted two of the country's largest banks to oversee the liquidation of 131 troubled investment funds. Officials stated they were working to prevent contagion spreading to the wider financial system.
Sources: Bloomberg Markets, FT Companies, FT Home