ISTANBUL (Dispatches) — The head of Turkey’s Banking Regulation and Supervision Agency (BDDK), Şahap Kavcıoğlu, said on Wednesday he had asked President Recep Tayyip Erdoğan to relieve him of his duties, after allegations linked the regulator to a sprawling investment fund crisis that has rattled Turkish markets and drawn scrutiny of the country’s financial oversight.
Kavcıoğlu, a former central bank governor, said he acted to prevent further damage to the institution. “I have requested my pardon from our President … so that our agency is not worn down further,” he said in a statement on social media. 
He denied allegations of personal financial involvement or bribery, saying the BDDK had “nothing to do with the fund issue” and that neither he nor his family held investments in the funds or the stock market.
The resignation followed the detention and subsequent jailing of three senior BDDK officials — Deputy Governor Muhammed Erişen and department heads Bilal Soysal and Mustafa Alper Taş — as part of a probe into capital-market transactions involving investment funds. 
In September, regulators ordered the liquidation of 131 funds managed by seven asset managers after warnings they could not meet redemptions. The funds had grown to over $20 billion in assets within three years, drawing nearly half a million investors.
The controversy intensified after a former ruling AKP politician, Savcı Sayan, publicly accused Kavcıoğlu of seeking a 20 billion-lira bailout from a businessman tied to the funds in exchange for a 35 billion-lira credit line via Takasbank. 
The BDDK had called the claims “entirely baseless.” Kavcıoğlu said hours before resigning that he had no personal stake in the matter and rejected any suggestion of impropriety in the agency’s handling of the fund sector.
The Presidency has not yet announced whether his resignation was accepted. Kavcıoğlu, 59, served as central bank governor from 2021 to 2023, a period marked by unorthodox monetary policy and a lira slump, before being appointed to lead the BDDK. 
His departure deepens uncertainty over the regulatory response to the fund crisis, which has raised questions about retail investor protection and the supervision of fast-growing asset managers.
Analysts said the move could complicate efforts to restore confidence in Turkey’s financial system, already strained by inflation and currency volatility. Opposition lawmakers have called for a parliamentary inquiry into the fund collapse and the regulator’s role, while market participants are watching for signs of how the government will handle the fallout.