Turkish authorities have detained 13 individuals as part of a wide-ranging investigation into fintech firm Papara, on allegations including money laundering, facilitating illegal betting, and forming a criminal organization, according to Interior Minister Ali Yerlikaya.
Papara, which offers services such as online money transfers, foreign exchange transactions, and bill payments to its 21 million users, is accused of enabling the creation of user accounts used to transfer proceeds from illegal betting activities.
State broadcaster TRT Haber reported that among those detained was Papara’s founder and chairman, Ahmet Faruk Karsli.
In response to the investigation, a Turkish court appointed the Savings Deposit Insurance Fund (TMSF) as a trustee for Papara, following reports from the central bank, the Financial Crimes Investigation Board (MASAK), and other authorities.
The central bank, which oversees payment institutions, announced temporary daily transaction limits for the platform, stating:
“During this process, which will be carried out in coordination with the relevant bodies, temporary daily caps will be applied to transactions.”
Authorities also sought to reassure users that their funds are safe, noting that, under the law, customer funds at payment and electronic money institutions are protected in bank-held safeguarding accounts.
Interior Minister Yerlikaya further stated that ten affiliated companies, along with various bank accounts and assets linked to the detained individuals, were seized. A financial crimes unit report found that over 26,000 accounts were involved in illegal betting, with total transactions reaching 12.9 billion lira (approximately $330 million).
Papara, founded in 2015 and licensed as an electronic money institution by the Banking Regulation and Supervision Agency (BDDK) in 2016, has grown rapidly. In 2023, it expanded internationally through the acquisitions of Pakistan-based SadaPay and Spain-based Rebellion Pay.
Papara is owned by PPR Holding, and Trade Registry data shows that as of May 2024, Karsli held a 90% stake in the company. The company has not yet issued a public comment regarding the investigation.
