Unlicensed Investment Services in Türkiye: the offence people do not know exists
Providing investment services in Türkiye (Turkey) without a licence is a criminal offence in its own right, punishable under Article 109(2) of the Capital Markets Law No. 6362 by two to five years' imprisonment and a judicial fine of five thousand to ten thousand days. It is separate from fraud: an operation can be charged with both, and being cleared of one does not answer the other. That distinction matters most to the people who never thought the question applied to them — the sales employee, the local manager, the foreign investor who wired money to a platform that turned out to be unregistered. This guide explains what the offence is, who it reaches, the procedural condition that governs when it can even be prosecuted, and what the Capital Markets Board can do while a criminal file runs in parallel.
What counts as unlicensed capital-markets activity?
Turkish law does not ask what a business calls itself. It asks what the business does. If an entity takes orders, receives client funds, offers portfolio management, arranges trades in capital-market instruments or holds itself out as doing any of those things, it is carrying on capital-markets activity — and that activity requires authorisation from the Capital Markets Board (Sermaye Piyasası Kurulu, the SPK).
Two features of that sentence do the work. First, it is drafted around the activity, not around a company form, a licence application or a contract. A business that never applied for anything is squarely inside it. Second, the judicial fine is expressed in days, not in a lump sum, which is how Turkish criminal law scales a financial penalty to the individual — the day count is set by the court and then multiplied by a daily amount fixed within the range the Criminal Code allows.
The first paragraph of the same article covers a related but distinct wrong: offering capital-market instruments to the public without publishing an approved prospectus, or selling them without an approved issue document, carries the same two-to-five-year range. Where a person carrying on unlicensed activity also commits the first-paragraph offence in the course of it, the article directs that punishment is imposed only for the second-paragraph offence — and that the sentence is increased by half. The concentration is not a discount. For the regulatory background — who the SPK is, what counts as a regulated instrument, and how the market-abuse regime sits alongside this — see our overview of capital markets law in Türkiye for foreign investors.
Why is this a separate offence from fraud?
This is the single most common misunderstanding, and it runs in both directions. People assume that if nobody was deceived there is no case, or that if there was deception the licensing question is academic. Neither holds.
Fraud under Article 157 of the Turkish Criminal Code requires deceptive conduct that misleads a person and produces a benefit at someone's expense; it carries one to five years plus a judicial fine of up to five thousand days. Its qualified form under Article 158 raises the range to three to ten years — and where the offence is committed using information systems or banks or credit institutions as the instrument, the article sets a floor of four years and requires the judicial fine to be no less than twice the benefit obtained. Our guide to fraud crime in Turkish law works through those elements in detail.
Unlicensed activity under Law No. 6362 asks a different question entirely: not whether anyone was deceived, but whether the business was permitted to do what it did. A scrupulously honest, fully transparent operation that simply never obtained authorisation still commits the Article 109(2) offence. Equally, obtaining a licence does not immunise anyone from a fraud charge.
| Question | Unlicensed activity (Law 6362, art. 109(2)) | Fraud (TCK arts. 157–158) |
|---|---|---|
| What must be shown | That capital-markets activity was carried on without authorisation | Deceptive conduct, a person misled, and a benefit at another's expense |
| Is a victim's loss required | No | Yes — the benefit is obtained at someone's expense |
| Penalty range | 2–5 years + 5,000–10,000 days' judicial fine | 1–5 years (art. 157); 3–10 years qualified (art. 158) |
| Can a prosecution start on its own | No — see the Board's written application, below | Yes |
Who can be prosecuted — the employee, the manager, or both?
Investigations into this kind of business rarely stop at the person who signed the incorporation papers. They sweep in whoever was working there. But Turkish criminal law does not treat everyone in a building alike, and the distinctions are worth understanding before anyone assumes the worst about their own position.
Criminal liability under Turkish law is built on intent. What a person knew, and what they meant to do, is the question — not simply whose payroll they were on. That principle is the same one that governs the exposure of directors generally, which we set out in our guide to the criminal liability of company executives in Turkey.
Where an organised structure is alleged, the Criminal Code adds a second layer on top of the underlying offence. Article 220 punishes founding or managing an organisation formed to commit crimes with five to ten years' imprisonment, and requires the organisation to have at least three members. Membership of such an organisation carries two to five years. A person who is not inside the hierarchy but knowingly and willingly helps the organisation is punished as a member, though the sentence may be reduced by up to one third according to the nature of the help. Where crimes are committed within the organisation's activity, those crimes are punished separately as well.
Fraud carries its own aggravation for group conduct. Article 158(3) increases the sentence by half where the offence is committed by three or more people together, and doubles it where it is committed within the framework of an organisation formed to commit crime.
| Position | What is usually in issue |
|---|---|
| Sales or call-centre staff | What the person was told the product was, what scripts and training they were given, whether they had sight of client funds or of the licensing position, and when they learned anything that should have changed their view |
| Local or team managers | Authority over scripts, targets and client money; visibility of complaints; whether they raised or suppressed concerns |
| Directors and signatories | The licensing decision itself, banking arrangements, the flow of funds, and the corporate paperwork that shows who decided what and when |
| Anyone alleged to be in an organisation | Whether the structural elements of Article 220 are made out at all, separately from the underlying offence |
None of this is a prediction about any particular file. It is the map of what an investigation is actually looking at, and it is why two people questioned in the same investigation can end up in entirely different positions.
Can a prosecution start without the Capital Markets Board?
Here is the provision that almost nobody outside the field knows about, and it is a genuine feature of the statute rather than a technicality.
The same article adds that where a public prosecution is opened on that application, a copy of the indictment is served on the Board upon its acceptance, and the Board simultaneously acquires the status of an intervening party. The prosecutor may also draw on the Board's professional staff during the investigation.
The Board is not only a brake. Article 115(4) gives it the power to object to a decision that there are no grounds for prosecution, so its involvement can cut in either direction.
Two honest qualifications, because getting this wrong in either direction is costly.
- It is confined to this Law. The condition governs offences defined in or referred to by Law No. 6362. It does not reach a fraud charge under Articles 157 or 158 of the Criminal Code, nor a money-laundering charge, nor any other offence outside that statute. A file can therefore proceed on the Criminal Code counts while the capital-markets counts wait on the Board.
- It is a condition of prosecution, not a defence to the conduct. It governs when the machinery may start, not whether the underlying activity was lawful.
A comparable gatekeeper exists in the payment-services regime under a different statute, which we cover in our piece on fintech sanctions and criminal liability in Turkey. Where an operation touches both regimes, both gatekeepers matter, and they do not necessarily open at the same time.
What can the Board do while a criminal case runs?
The criminal file is not the only thing happening. The Board has its own powers, and they operate on their own timetable — which is why an operation can be shut down long before any court reaches a verdict, and why an investor may have a route to funds that does not depend on a conviction.
Those two periods deserve attention from everyone involved, on either side of the matter. They are not the criminal limitation period; they are the window for this particular civil route, and they run from different starting points — detection for the one-year period, occurrence for the five-year long-stop.
The same article provides that where the Board has established the responsibility of shareholders and managers of a person carrying on unlicensed activity, a further provision of the Law applies by analogy without requiring that the loss arising from those activities has become final.
What other offences does the same law carry?
An investigation into an investment business seldom rests on a single article. The Capital Markets Law contains a cluster of offences that tend to travel together, and a foreign national reading a Turkish indictment for the first time is usually looking at several of them at once.
| Article of Law 6362 | Conduct | Penalty |
|---|---|---|
| 106 | Insider dealing — trading on price-sensitive information not yet disclosed to the public, by defined categories of person | Set by that article |
| 107(1) | Market fraud — trading, placing, cancelling or amending orders, or generating account movements, to create a false or misleading impression about prices, price movements, supply or demand | 3–5 years + 5,000–10,000 days; the fine cannot be less than the benefit obtained |
| 109(1) | Public offering without an approved prospectus, or sale without an approved issue document | 2–5 years + 5,000–10,000 days |
| 109(2) | Carrying on capital-markets activity without authorisation | 2–5 years + 5,000–10,000 days |
| 109/A | Operating as a crypto-asset service provider without permission (added 2024) | 3–5 years + 5,000–10,000 days |
| 110 | Qualified breach of trust — including dealing with client instruments, cash or other valuables entrusted to an investment institution for one's own or another's benefit | Sentence under TCK art. 155(2), and not less than three years |
| 111(1) | Failing to provide information, documents or records requested by the Board, at all or in the form requested | 1–3 years |
Article 111 is the one people walk into after the fact. It attaches to the response to the Board, not to the original business — which means conduct during the investigation itself can add a separate charge.
Where client money has moved through accounts, an anti-money-laundering dimension usually follows as well; the obligations and the exposure are set out in our guide to money laundering and MASAK compliance in Türkiye.
What does this mean for a foreign national's status in Türkiye?
For a foreign national the criminal file is only half the picture. The other half is status, and it moves on a separate track with its own decision-makers and its own deadlines.
A criminal proceeding can affect a residence permit application or renewal, and a conviction can be followed by a deportation decision and a re-entry restriction recorded against the person. Those are administrative decisions with short challenge periods that do not wait for the criminal case to finish. We set out how removal decisions and entry restrictions work, and the windows for challenging them, on our deportation and entry ban page; the wider picture for a foreign national facing a Turkish criminal process is in what happens when foreigners commit crimes in Turkey.
There is also the practical dimension of being a foreign suspect: the right to a lawyer and to an interpreter from the first contact, consular notification, and the fact that a statement given before any of that is in place is very difficult to unwind afterwards. Those mechanics are covered on our criminal defence page.
What to do if you are questioned
Nothing in this section is a promise about any outcome. It is the sequence that keeps options open rather than closing them.
- Say that you want a lawyer, and say it before you say anything else. The right exists from first contact; using it is not an admission of anything.
- Do not give a statement through an interpreter you cannot follow. If you do not understand the language of the question, the record will not reflect the answer you meant to give.
- Preserve what you have. Employment contract, offer letter, job description, training materials, scripts, internal messages, payslips, and anything showing what you were told the product was and who you reported to. Do not delete anything — deletion is itself a fact that gets noticed.
- Establish what is actually alleged. Which article, which paragraph, and whether the capital-markets counts are supported by the Board's written application at all.
- Deal with the status question in parallel. Residence and entry decisions run on their own clocks and will not wait for the criminal file.
If you are outside Türkiye and need to instruct a lawyer here without travelling, a Turkish power of attorney is enough to begin; the routes for issuing one from abroad are set out on our page about hiring a lawyer in Türkiye from abroad.
Frequently asked questions
Is running an unlicensed investment business a crime in Turkey even if no client lost money?
Yes. Article 109(2) of the Capital Markets Law No. 6362 is drafted around the activity, not around loss or deception. Carrying on capital-markets activity without authorisation is punishable by two to five years' imprisonment and a judicial fine of five thousand to ten thousand days, whether or not anyone complains.
Can I be prosecuted for unlicensed capital-markets activity without the Capital Markets Board being involved?
Not for the offences under that Law. Article 115(1) makes an investigation into offences defined in or referred to by Law No. 6362 dependent on a written application by the Board to the chief public prosecutor, and states that this application is a condition of prosecution. It does not affect charges outside that Law, such as fraud under the Criminal Code.
I worked in sales at a firm now under investigation. Am I automatically a suspect?
Being on the payroll is not the same as being criminally liable. Turkish criminal law turns on intent — what you knew and what you meant to do. What you were told the product was, the scripts and training you were given, whether you had any sight of client funds or of the licensing position, and when you learned anything that should have changed your view are all in issue. Speak to a lawyer before giving a statement.
Is unlicensed activity the same charge as fraud?
No, and both can be charged on the same facts. Fraud under Articles 157 and 158 of the Criminal Code requires deception and a benefit at someone's expense. Unlicensed activity under Law No. 6362 asks only whether the business was authorised. An honest but unlicensed operation still commits the licensing offence; a licensed one can still commit fraud.
Can investors get money back if a platform turns out to be unlicensed?
There is a route that does not depend on a conviction. Article 99(1) of Law No. 6362 lets the Capital Markets Board take measures to stop unlicensed activity and bring an action for the annulment of its consequences and the return of cash or capital-market instruments to those entitled, within one year from detection and in any event five years from occurrence. Separate civil and enforcement steps may also be available depending on the facts.
How does a criminal investigation affect my residence permit?
It runs on a separate track. A pending proceeding can affect a permit application or renewal, and a conviction can be followed by a deportation decision and a re-entry restriction. Those are administrative decisions with short challenge periods that do not wait for the criminal case to conclude, so they need attention in parallel.
Does this apply to crypto platforms too?
Since 2024 crypto has its own provision. Article 109/A of Law No. 6362, added on 26 June 2024 by Law No. 7518, punishes natural persons found to be operating as a crypto-asset service provider without permission, and the officers of legal persons doing so, with three to five years' imprisonment and a judicial fine of five thousand to ten thousand days — a floor one year higher than the general unlicensed-activity offence.
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