ANKARA (Dispatches) -- Turkey’s fund crisis escalated sharply on Sunday as President Recep Tayyip Erdogan replaced the leadership of the capital markets regulator and the CEO of Borsa Istanbul was detained on bribery charges.
The incidents deepened a scandal that has wiped more than $100 billion from Turkish equities and shaken investor confidence in the country’s financial system.
Erdogan appointed Muhsin Atci, head of the Tax Inspection Board, as chairman of the Capital Markets Board (SPK), according to a decree published in the Official Gazette early Sunday. 
Ersin Basar Ekmekci was named deputy chairman and Yasemin Girici a board member. Atci, a 23-year career tax enforcement official with a master’s degree from Duke University, replaces Mahmut Sutcu, who was dismissed on October 20 amid the turmoil.
The regulatory shakeup came as state-run Anadolu Agency reported that Korkmaz Ergun, CEO of Borsa Istanbul since 2021, was detained on allegations of accepting bribes and membership in a criminal organization. 
Ergun also serves as deputy chairman of Takasbank, Turkey’s settlement and custody bank. The detention marks a further expansion of a sweeping probe into alleged manipulation involving investment funds and stocks.
The crisis began in mid-September when several funds said they could not meet investors’ redemption requests during a market sell-off. The SPK suspended trading in 131 funds run by seven asset management companies and placed them into liquidation, affecting nearly half a million investors. 
Prosecutors are investigating whether fund assets were artificially inflated to deceive investors, with Justice Minister Akin Gurlek describing the scheme as “Ponzi-like”. Nearly 120 people have been arrested, including former central bank deputy governor Erkan Kilimci and former Turkiye Sigorta CEO Taha Cakmak.
The market impact has been severe. The benchmark Borsa Istanbul 100 index fell for a seventh consecutive week through Friday, its longest weekly losing streak on record, and has lost 25% since the start of September. 
The rout has erased more than $100 billion from the market value of Turkish stocks. Analysts warned that the detention of the exchange’s top executive would further undermine investor confidence, increase volatility, and potentially accelerate foreign capital outflows.
The appointments signal that Erdogan’s government is treating the collapse as a systemic threat requiring both regulatory overhaul and criminal accountability.