Anti-Money Laundering Rules for Foreign Institutional Investors in Turkey: Law No. 5549, Customer Due Diligence, Beneficial Ownership, Suspicious Transaction Reports and MASAK’s Power to Postpone Transactions

Every Turkish bank, broker, portfolio management company and clearing and custody institution that a foreign institutional investor deals with is an obliged party under Law No. 5549 on the Prevention of Laundering Proceeds of Crime. Before establishing a continuing business relationship, it must identify the customer, anyone acting on the customer’s behalf and the beneficial owner (Measures Regulation Arts. 5 and 17/A). Documents of legal persons established abroad must be legalised by a Turkish consulate or apostilled, with a notarised Turkish translation where the risk-based approach requires (Art. 11). If identification cannot be completed, the relationship must not be established or must be ended (Art. 22). Suspicious transactions must be reported to the Financial Crimes Investigation Board (MASAK) within ten working days of the suspicion arising. Nobody, including the customer, may be told that a report has been made (Law Art. 4; Regulation Arts. 28–29). The Minister of Treasury and Finance may suspend a transaction, or prevent it from being carried out, for seven working days (Law Art. 19/A). Insider dealing and transaction-based market manipulation both carry imprisonment with a lower limit of three years, so their proceeds can be the subject of the laundering offence (Criminal Code Art. 282; Capital Markets Law Arts. 106 and 107). This guide explains these rules for foreign institutional investors. It reflects the legislation in force as at 26 October 2026, including the amendments to the Measures Regulation published on 7 October 2026.

Why anti-money laundering rules matter to foreign institutions

Anti-money laundering rules affect a foreign institutional investor in Turkey in three ways. First, every Turkish financial institution it deals with must identify it and its beneficial owners before opening an account or carrying out a transaction, and must keep monitoring the relationship. Gaps in documentation can delay or block trading, transfers and the return of assets. Second, after market disruptions such as the 2026 fund and market manipulation cases, financial institutions apply closer scrutiny to unusual transactions and file more suspicious transaction reports. MASAK can also suspend transactions. An institution may find a transfer delayed without being told why, because the law forbids disclosure. Third, the proceeds of market manipulation and insider dealing can be laundered, and the laundering offence and its investigation tools play a part in tracing and seizing assets that investors may later seek to recover.

This guide does not deal with the obligations of a foreign institution under its home country’s rules. It explains the Turkish rules that Turkish financial institutions apply to their customers, and the powers of Turkish authorities that may affect a foreign investor’s accounts and transactions.

The legal framework

The main instrument is Law No. 5549 on the Prevention of Laundering Proceeds of Crime. It sets out customer identification (Art. 3), suspicious transaction reporting (Art. 4), compliance systems (Art. 5), the duty to provide information (Art. 7), record keeping (Art. 8), protection of reporters (Art. 10), administrative fines (Art. 13), criminal offences (Arts. 14 and 15) and the postponement of transactions (Art. 19/A).

The detailed rules are in the Regulation on Measures for the Prevention of Laundering Proceeds of Crime and Financing of Terrorism (the Measures Regulation), first published in the Official Gazette of 9 January 2008 and amended many times, most recently by Presidential Decisions No. 10945 (Official Gazette 13 February 2026) and No. 11845 (Official Gazette 7 October 2026). A separate Regulation on the Postponement of Transactions sets out the procedure under Art. 19/A. Asset freezing is governed by Law No. 6415 on the Prevention of the Financing of Terrorism and Law No. 7262 on the Prevention of Financing of Proliferation of Weapons of Mass Destruction. The laundering offence itself is in Art. 282 of the Turkish Criminal Code.

Who must apply the rules

Obliged parties include those active in banking, insurance, private pensions, capital markets and other financial services, together with a range of non-financial businesses and professions (Law Art. 2(1)(d)). The Measures Regulation lists them, together with their branches, agents, representatives and similar units. The list includes banks, capital markets intermediary institutions and portfolio management companies, investment companies, institutions providing clearing and custody services under capital markets legislation, and crypto asset service providers (Measures Regulation Art. 4(1)(a), (d), (f), (h) and (ü)). Branches, agents and representatives in Turkey of obliged parties headquartered abroad are themselves obliged parties (Art. 4(2)).

The Central Registry (MKK) is subject to the identification and reporting rules only with respect to its members, which are the institutions that hold accounts in the system, not their underlying clients (Art. 47(1)). How the Central Registry and omnibus accounts work is explained in our guide to Turkish book-entry securities and the Central Registry.

For a foreign institutional investor, this means that its Turkish broker, its local custodian bank, any Turkish portfolio manager it appoints and, where applicable, the clearing and custody institution are each responsible for applying the rules within their own relationship with it.

Customer due diligence for a foreign institution

When identification is required. Obliged parties must identify their customers, and those acting on their behalf or for their account, and take the measures needed to identify the beneficial owner of the transaction. This applies regardless of amount when a continuing business relationship is established, when a suspicious transaction report is required, and when there is doubt about the adequacy or accuracy of identification information obtained earlier. For occasional transactions it applies above monetary thresholds set in the Regulation, which were last raised on 7 October 2026 (Measures Regulation Art. 5(1)). Identification must be completed before the relationship is established or the transaction is carried out (Art. 5(2)). When a continuing relationship is established, information is obtained on its purpose and nature (Art. 5(3)). A continuing business relationship includes one arising from opening an account (Art. 3(1)(i)).

Legal persons established abroad. Identification of a legal person resident abroad is based on documents from its country that correspond to those required for Turkish legal persons. These must be certified by a consulate of the Republic of Türkiye or apostilled under the Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents. Where the risk-based approach requires, the identification information is verified through notarised Turkish translations (Art. 11(1)). For Turkish companies, the information includes the trade name, registration and tax numbers, field of activity, address and contact details, and the identity of the persons authorised to represent it, with their signatures (Art. 7(1)).

Representatives. Where persons authorised by the representatives of a legal person request transactions, the legal person, its representatives and the authorised persons are each identified. The authority of the authorised persons is verified through a notarised power of attorney or a written instruction from the representatives. The signatures on the instruction are checked against a notarised signature circular (Art. 14(1)). If a representative cannot be identified from identity documents, identification may be made through a notarised power of attorney or signature circular containing the required information (Art. 14(1)(b)).

Trusts and similar arrangements. Where a trustee of a trust established abroad requests a transaction for the trust assets, it must declare in writing before the transaction that it is acting for the trust. The trust deed is used for identification, certified or apostilled. The settlor, the beneficiaries and any person designated in the deed to supervise the trust are identified as part of the beneficial ownership inquiry (Art. 11(2)–(3)).

Ongoing monitoring. Obliged parties must continuously monitor whether customers’ transactions are consistent with their profile, business, financial situation and sources of funds, and keep customer information up to date (Art. 19(1)). They must pay special attention to complex and unusually large transactions and to transactions with no apparent reasonable legal and economic purpose (Art. 18(1)), and to non-face-to-face relationships and new technologies (Art. 20).

Beneficial ownership and acting for others

Definition. The beneficial owner is the natural person or persons who carry out a transaction with an obliged party, or who ultimately control or have ultimate influence over the natural person, legal person or unincorporated body on whose behalf a transaction is carried out (Measures Regulation Art. 3(1)(h)).

Companies. When establishing a continuing relationship with a legal person registered in the trade registry, the obliged party identifies the natural person shareholders holding more than 25% of the shares. If such a shareholder is suspected not to be the beneficial owner, or there is none, it takes the measures needed to identify the natural persons who ultimately control the legal person. If none can be identified, the natural persons with the highest executive authority are treated as beneficial owners in their capacity as senior managers (Art. 17/A(2)–(4)). Legal person shareholders holding more than 25% are also identified, and information about such shareholders resident abroad may be verified through open sources of the official registers of their country (Art. 17/A(7)).

Other legal persons. For other legal persons and unincorporated bodies, the obliged party takes the measures needed to identify the natural persons who ultimately control them. If none can be identified, the natural persons with the highest executive authority are treated as beneficial owners (Art. 17/A(5)). Foreign public institutions, pension funds and investment funds that are not trade-registry companies fall under this rule. The identity of the beneficial owners is obtained and reasonable measures are taken to verify it (Art. 17/A(6)).

Acting for another person. Financial institutions obtain a written declaration from the customer, when a continuing relationship is established, on whether it is acting for another person (Art. 17(1)). Where it declares that it is, both the person requesting the transaction and the person for whose account it is acting are identified (Art. 17(2)). Under the Law, a person who acts in its own name but for another’s account in transactions requiring identification, and does not notify the obliged party in writing before the transaction of whose account it is acting for, commits a criminal offence (Law Art. 15). Global custodians and asset managers acting for clients through accounts in their own name should keep this rule in mind.

Simplified and enhanced measures

Simplified measures. The Ministry may allow obliged parties to apply simpler customer due diligence measures in transactions between financial institutions, where the customer is a public administration within the general government under Law No. 5018 or a professional body with public institution status, and where the customer is a company whose shares are publicly offered and listed on an exchange (Measures Regulation Art. 26(1)). The Ministry may define other low-risk transaction types. Simplified measures may not be applied where there is a risk of laundering or terrorist financing (Art. 26(2)). The public administrations referred to are those within the scope of Turkish Law No. 5018, so foreign public bodies are not covered by that category.

Enhanced measures. In the situations requiring special attention under Arts. 18, 20 and 25, and in high-risk situations identified on a risk basis, financial institutions apply one or more enhanced measures in proportion to the risk. These include obtaining additional information on the customer and the relationship, the source of funds and the purpose of the transaction, more frequent updating, senior management approval, closer monitoring, and requiring the first payment to come from another financial institution that applies customer due diligence (Art. 26/A(1)).

Risky countries. Financial institutions must pay special attention to business relationships and transactions with persons resident in, and nationals of, countries announced by the Ministry as risky (Arts. 3(1)(ı) and 25).

Reliance on third parties. A financial institution may rely on measures taken by another financial institution for identifying the customer, its representatives and the beneficial owner, and for information on the purpose of the relationship. Final responsibility remains with the relying institution (Art. 21(1)). A third party abroad must be subject to regulation and supervision in line with international anti-money laundering standards, and copies of identification documents must be obtainable from it without delay (Art. 21(2)). Reliance is not possible on third parties in risky countries (Art. 21(5)). Transactions between financial institutions on behalf of their customers are outside the reliance rules (Art. 21(4)).

Refusal and termination of the relationship

If an obliged party cannot identify the customer or obtain enough information about the purpose of the business relationship, it must not establish the relationship or carry out the requested transaction. It may not open anonymous accounts or accounts in fictitious names (Measures Regulation Art. 22(1)). If identification and verification required because of doubts about earlier information cannot be completed, the relationship is ended (Art. 22(2)). In both cases, the obliged party also considers whether the situation is a suspicious transaction (Art. 22(3)).

For an institution that already holds assets in Turkey, termination may mean the closure of accounts and the transfer of assets, and in practice can disrupt trading and settlement. Keeping the identification file complete and responding promptly to update requests is the most effective protection. The rules on investment firms’ duties towards clients are explained in our guide to investment services rules in Turkey.

Suspicious transaction reports and the ban on disclosure

The duty to report. Where there is any information, suspicion or reasonable grounds to suspect that assets involved in a transaction carried out or attempted through an obliged party were acquired illegally or are used for illegal purposes, the transaction must be reported to MASAK (Law Art. 4(1); Measures Regulation Art. 27(1)). Reports are made regardless of amount (Art. 27(2)). Several transactions may be assessed together (Art. 27(3)). The report must be made within ten working days of the date the suspicion arose, and new information is reported as an addition without delay (Art. 28(2)–(3)).

No disclosure. Obliged parties may not disclose to anyone, including the parties to the transaction, that a report has been or will be made, except to the inspectors supervising compliance and to the courts during proceedings (Law Art. 4(2); Measures Regulation Art. 29(1)). The ban covers all staff who know of the report (Art. 29(2)), and obliged parties may not inform even their own head offices or branches abroad that they have reported a customer (Art. 29(3)). Breach of the ban is punishable by one to three years’ imprisonment and a judicial fine (Law Art. 14(1)).

Protection of reporters. Persons who fulfil their obligations under the Law cannot be held liable under civil or criminal law (Law Art. 10(1); Measures Regulation Art. 29(4)). Information about who made a report may not be given to third parties, other than the courts, even where special laws provide otherwise (Law Art. 10(2)).

For a customer, the consequence is that a Turkish institution will not explain whether a delay or refusal relates to a report. Requests for explanations should be framed around the documentation and contractual position, not around whether a report has been made.

Postponement of transactions by MASAK

The power. Where there is suspicion that assets involved in a transaction attempted or in progress through an obliged party are connected with laundering or terrorist financing, the Minister of Treasury and Finance may suspend the transaction, or not allow it to be carried out, for seven working days. The purpose is to allow MASAK to confirm the suspicion, analyse the transaction or, where necessary, refer the results to the competent authorities. The Minister may delegate this power to a deputy minister (Law Art. 19/A(1)). The power may also be used on a reasoned request from a foreign counterpart, subject to reciprocity (Art. 19/A(2)). An obliged party that carries out a suspended transaction is fined an amount equal to the transaction, subject to a statutory minimum (Art. 19/A(3)).

Three routes. The Regulation on the Postponement of Transactions provides three routes. An obliged party that has documents or serious indications supporting the suspicion sends a suspicious transaction report with a request for postponement. It must then refrain from carrying out the transaction until the Minister’s decision is notified to it, but in any event for no more than seven working days from the report (Arts. 4(1) and (3)). MASAK may also identify assets held at an obliged party and obtain a postponement decision, which the obliged party must observe for seven working days from notification (Art. 5). A request from a foreign counterpart is assessed by MASAK and decided by the Minister on the basis of reciprocity (Art. 6). Decisions are notified to obliged parties electronically or by other immediate means (Art. 7).

After postponement. Postponement is short. If the authorities consider that the assets should be held for longer, the measures are those of the criminal process, such as seizure ordered by a judge under the Criminal Procedure Code, which are explained in our guide to freezing assets in Turkey for investor claims.

Information requests, records and sanctions

Duty to provide information. Public bodies, natural and legal persons and unincorporated bodies must provide MASAK and its inspectors with all information, documents and records requested, including passwords needed to access them (Law Art. 7(1)). They cannot refuse by relying on special laws, subject to the provisions on the right of defence (Art. 7(2)). Failure is punishable by one to three years’ imprisonment and a judicial fine (Art. 14(1)). A foreign institution or its Turkish representative that receives a request should respond fully and in time, with the help of Turkish counsel. The interaction between these powers and bank secrecy is explained in our guide to bank secrecy, customer secrets and personal data in Turkey.

Record keeping. Obliged parties keep documents for eight years from their date, books and records for eight years from the last entry, and identification documents for eight years from the last transaction. For accounts, the period for identification documents starts when the account is closed (Law Art. 8; Measures Regulation Art. 46(1)). Records of reports and internal notifications, and written reasons where a compliance officer decided not to report, are also kept (Art. 46(2)). These records can be important evidence in later criminal and civil proceedings, obtained through the courts and prosecutors.

Compliance systems. The Ministry sets the measures obliged parties must take on training, internal audit, control and risk management, including appointing a compliance officer, at the level of the obliged party and its financial group. Members of a financial group may share customer and transaction information within the group for these purposes, and may not refuse to do so on the basis of special laws (Law Art. 5).

Asset freezing under Laws No. 6415 and 7262

Law No. 6415 provides for the freezing of assets of persons and organisations listed under specified United Nations Security Council resolutions (Art. 5). Freezing may also follow requests of foreign governments, decided by the President on the basis of reciprocity (Art. 6), and domestic decisions in the circumstances set out in the Law (Art. 7). Freezing decisions take effect on publication in the Official Gazette (Art. 12(1)). Persons whose assets are frozen, and persons with claims against or debts to them, must report these to MASAK within thirty days of publication (Art. 12(3)). Frozen assets remain under their owner’s management, but cannot be disposed of, transferred or otherwise used, and others may not facilitate such transactions (Art. 13(1)). Law No. 7262 applies a similar framework to the financing of proliferation of weapons of mass destruction.

These regimes are aimed at terrorist and proliferation financing. They are not a route for investors to recover losses, but a foreign institution should be aware that a counterparty or issuer subject to a freezing decision cannot freely deal with its assets.

Laundering of proceeds of capital markets offences

The offence. A person who takes abroad assets derived from an offence punishable by a minimum of six months’ imprisonment or more, or subjects them to transactions to conceal their illegal source or give the impression that they were lawfully acquired, commits laundering, punishable by three to seven years’ imprisonment and a judicial fine (Criminal Code Art. 282(1)). Acquiring, accepting, holding or using such assets knowing their nature, without participating in the predicate offence, is punishable by two to five years’ imprisonment (Art. 282(2)). The penalty is increased for public officials and members of a profession acting in the course of it (Art. 282(3)), and doubled where the offence is committed within a criminal organisation (Art. 282(4)). Security measures apply to legal persons (Art. 282(5)).

Capital markets offences as predicates. Insider dealing is punishable by three to five years’ imprisonment or a judicial fine (Capital Markets Law Art. 106(1)), and market manipulation through transactions by three to five years’ imprisonment and a judicial fine (Art. 107(1)). Both provide for imprisonment with a lower limit above the six-month threshold, so their proceeds can be the subject of laundering. Investigations into the 2026 cases may involve both the capital markets offences and laundering. How these offences are defined is explained in our guide to market manipulation under Turkish law, and the Criminal Code offences in our guide to Criminal Code offences in Turkish capital markets cases.

Effective repentance and asset recovery. A person who, before prosecution begins, enables the assets that are the subject of laundering to be seized, or facilitates their seizure by informing the authorities of their location, is not punished for laundering (Criminal Code Art. 282(6)). The rule is designed to bring assets to light, which can matter to victims seeking recovery. Laundering is also among the offences for which a court may appoint a trustee to run a company during an investigation (Criminal Procedure Code Art. 133(4)), as explained in our guide to company liability for managers and employees in Turkey. Cooperation with foreign authorities on assets moved abroad is explained in our guide to international judicial cooperation under Law No. 6706.

Points for foreign institutional investors

Keep the file current. Identification documents of a foreign legal person must be certified or apostilled, and notarised Turkish translations may be needed (Measures Regulation Art. 11(1)). Changes in signatories, structure or control should be reflected promptly, because doubt about earlier information triggers fresh identification (Art. 5(1)(e)), and failure to verify can end the relationship (Art. 22(2)).

Clarify the capacity in which accounts are held. Where a custodian or manager holds Turkish assets in its own name for clients, the written declaration on acting for another’s account (Art. 17(1); Law Art. 15) and the identification of the persons for whose account it acts (Art. 17(2)) should be addressed when the relationship is established.

Plan for delays. A transaction may be suspended for up to seven working days without explanation (Law Art. 19/A). Settlement, redemption and repatriation timetables in Turkey should allow for this possibility during periods of heightened scrutiny. The currency and repatriation rules are explained in our guide to Turkish currency law and repatriation of investment proceeds.

Frequently asked questions

Which Turkish law governs anti-money laundering?

Law No. 5549 on the Prevention of Laundering Proceeds of Crime, with the Measures Regulation and the Regulation on the Postponement of Transactions. The laundering offence is in Criminal Code Art. 282.

Are Turkish brokers and custodians obliged parties?

Yes. Banks, intermediary institutions, portfolio management companies, investment companies and clearing and custody institutions are among the obliged parties (Measures Regulation Art. 4(1)).

What documents must a foreign institution provide?

Documents corresponding to those required for Turkish legal persons, certified by a Turkish consulate or apostilled, with notarised Turkish translations where required on a risk basis (Art. 11(1)).

How is the beneficial owner of a foreign institution determined?

For entities other than trade-registry companies, the natural persons who ultimately control it; if none can be identified, the persons with the highest executive authority (Art. 17/A(5)).

Do simplified measures apply to foreign public institutions?

The public-administration category in Art. 26(1)(b) refers to bodies within the general government under Turkish Law No. 5018. Simplified measures are also possible for listed companies and between financial institutions, but never where there is a laundering risk (Art. 26).

What if identification cannot be completed?

The relationship must not be established or the transaction carried out, and an existing relationship is ended where verification fails (Art. 22).

Must a custodian disclose that it acts for clients?

Yes. A person acting in its own name for another’s account must declare this in writing before transactions requiring identification; failure is a criminal offence (Law Art. 15; Measures Regulation Art. 17).

How quickly must suspicious transactions be reported?

Within ten working days of the suspicion arising (Measures Regulation Art. 28(2)).

Will the bank tell me if it has reported my transaction?

No. Disclosure to anyone, including the parties, is prohibited and punishable by imprisonment (Law Arts. 4(2) and 14(1)).

Can MASAK stop a transaction?

Yes. The Minister may suspend a transaction or prevent it from being carried out for seven working days where laundering or terrorist financing is suspected (Law Art. 19/A).

Can a foreign authority ask Turkey to suspend a transaction?

Yes. A reasoned request from a foreign counterpart is assessed by MASAK and decided on the basis of reciprocity (Law Art. 19/A(2); Postponement Regulation Art. 6).

How long are records kept?

Eight years; for accounts, the period for identification documents runs from the closure of the account (Law Art. 8; Measures Regulation Art. 46).

Can secrecy be invoked against MASAK?

No. Information requested by MASAK must be provided, and special laws cannot be relied on to refuse, subject to the right of defence (Law Art. 7).

Can the proceeds of market manipulation be laundered?

Yes. Manipulation and insider dealing provide for imprisonment of three to five years, above the six-month threshold for predicate offences (Criminal Code Art. 282(1); Capital Markets Law Arts. 106 and 107).

Does the laundering offence help victims recover assets?

Indirectly. A person who enables seizure of laundered assets before prosecution is not punished for laundering (Criminal Code Art. 282(6)), and investigations can lead to seizure of assets.

Related guides

• Turkey’s 2026 Fund and Market Manipulation Crisis: Legal Guide for Foreign Institutional Investors — the entry point to this series
• MSCI’s Turkey Index Freeze and the Legal Response
• Lease Certificates (Sukuk) in Turkey
• Inflation Accounting in Turkey: TMS 29 and the Tax Books
• Individual Application to Turkey’s Constitutional Court and the ECHR
• Privileged Shares in Turkish Listed Companies
• Enforcing a Money Judgment in Turkey
• Turkey’s Emissions Trading System and Climate Law No. 7552
• Criminal Code Offences in Turkish Capital Markets Cases
• Freezing Assets in Turkey for Investor Claims
• Suspects, Evidence and Assets Abroad: International Judicial Cooperation under Law No. 6706
• Bank Secrecy, Customer Secrets and Personal Data in Turkey
• Investment Services Rules in Turkey: Communiqués III-37.1 and III-39.1
• Turkish Book-Entry Securities and the Central Registry (MKK)
• Market Manipulation under Turkish Law
• Company Liability for Managers and Employees in Turkey
• Turkish Currency Law and Repatriation of Investment Proceeds