Turkish Court Jails Ex-Minister Fatma Betül Sayan Kaya Pending Trial in Fund Probe; She Denies Wrongdoing

A court in Istanbul has ordered Fatma Betül Sayan Kaya, a former family and social affairs minister and until September a deputy chair of President Recep Tayyip Erdoğan's ruling Justice and Development Party (AKP), held in custody pending trial.

She was taken into custody late Thursday, Nov. 5, after a second round of questioning, and remanded overnight. The charges are violating Turkey's Capital Markets Law and membership in an organization established to commit crimes, the state-run Anadolu Agency reported.

Her husband, İlyas Kaya, was released on condition that he report regularly to police. So was former Capital Markets Board (SPK) chairman İbrahim Ömer Gönül, who is also under investigation.

What prosecutors allege

The prosecutors' referral document, as quoted by Anadolu, says Kaya is suspected of having access to insider investment information. It says she knew Erdin Özel, a manager at Tera Group, one of the firms at the center of the case, and was in touch with him "intensively" during the investment process.

Tera Group had invested heavily in Özata Denizcilik, a shipbuilder. Prosecutors say Kaya bought Özata shares in April 2026 and sold them on Sept. 16, a day before the scandal became public.

They also point to how the sale was settled. Proceeds from such sales normally arrive within two business days. In Kaya's case, prosecutors say, the shares were sold through a transfer arrangement and the balance was credited to her account the same day.

The document states: "It appears the suspect knew the likely price movement range of the stocks and also carried out transactions knowing that the liquidation decision would be taken." That is an allegation, not a finding.

Her defense

Kaya denies wrongdoing. She told prosecutors she bought the shares in April and sold them in August and September. She said she received no tips and had no information unavailable to other investors. Her husband denies market manipulation.

The couple also repaid money. They returned about 1.86 billion lira, roughly $37 million, through a voluntary repayment mechanism run by the Savings Deposit Insurance Fund (TMSF). Their original investment and calculated interest were excluded from the payment.

Justice Minister Akın Gürlek has said returning money does not end a criminal investigation, though it can qualify a suspect for a reduced sentence. Detention pending trial is not a conviction, and Kaya has not been tried.

The numbers behind the scandal

Opposition lawmaker Zeynel Emre of the Yeni Parti alleged in September that the couple invested about 163 million lira and received about 2.17 billion lira, roughly $43 million, from selling the shares before the crisis. That figure is the opposition's claim. It was not established in court.

Kaya resigned her party leadership posts on Sept. 26, after Emre sought clarification over the allegations. The AKP later confirmed she was no longer a member.

The broader collapse is large. On Sept. 17, the SPK placed seven companies into liquidation. They managed 131 investment funds with assets reportedly worth $17 billion and 455,758 individual investors. That investor figure does not show how many are still awaiting repayment.

The scheme at issue, as described in the case, is that funds bought thinly traded shares to inflate prices and the value of their own portfolios. When prices fell and investors tried to withdraw money, some funds could not pay.

Gürlek said this week that more than 430 people are under investigation for suspected market manipulation and insider trading. Of those, 112 have been arrested.

The regulator question

The case is not only about who sold what and when. It also raises the question of where the watchdog was.

Gönül chaired the SPK from April 2022 to April 2026. He gave a statement as a suspect on Sept. 30. Prosecutors sought permission to investigate him for suspected abuse of office, alleging he failed to fulfill his duties to oversee investment funds.

He has been released on condition, and no charges against him have been announced.

The political exposure is plain. A woman who sat in Erdoğan's cabinet and held a senior party post is now in custody in a case where the opposition alleges politically connected investors cashed out before ordinary savers were locked in. The government's counterpoint is on the record. The Justice Ministry says it is prosecuting hundreds of suspects, and the AKP dropped Kaya from its ranks.

Next up is whether prosecutors file an indictment against Kaya and others, and whether the abuse-of-office inquiry into the former regulator chief moves forward. Neither a trial date nor a decision on Gönül has been announced. Hundreds of thousands of fund investors are still waiting to learn how much of their money will come back.