ISTANBUL: Turkish authorities detained 13 people as part of an investigation into fintech company Papara over suspected money laundering, illegal betting and establishing a criminal organization, Interior Minister Ali Yerlikaya said on Tuesday.
Yerlikaya said authorities determined that the company, which provides online money transfers, foreign-exchange transactions and bill-payment services for its 21 million users, was allowing users to open accounts to transfer illegal betting income.
A report by state broadcaster TRT Haber said the detentions included Papara’s founder and chairman, Ahmet Faruk Karsli.
As part of the probe, the Savings Deposit Insurance Fund (TMSF) was appointed as a trustee to Papara by a court decision, following reports from the central bank, the Financial Crimes Investigation Board (MASAK), and other relevant institutions.
The central bank, which regulates payment firms, said on Tuesday it would implement daily limits to transactions made on the platform.
“In this process, which will be carried out in coordination with the relevant institutions, temporary daily limits will be applied to payment transactions at the institution,” the central bank said in a statement.
It also sought to reassure users, noting that “within the scope of the law, the funds of payment service users in payment and electronic money institutions are secured in protection accounts at banks.”
Yerlikaya said 10 companies, bank accounts and assets of the detained individuals were seized as part of the investigation.
A report by the financial crimes unit found that more than 26,000 accounts were used for illegal online betting, involving transactions worth 12.9 billion lira ($330 million), he added.
Papara, one of Turkiye’s fastest-growing fintech companies, did not immediately respond to a request for comment.
The company was founded in 2015 and received an electronic money institution license from the banking regulator BDDK the following year. It expanded abroad by acquiring Pakistan-based SadaPay and Spain-based Rebellion Pay in 2023.
According to its website, Papara had 21 million users as of last year. PPR Holding owns Papara, and Trade Registry data shows Karsli held about 90 percent of the company as of May 2024.
