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Crime of Manipulation which is regulated in the Capital Market
Law No. 6362, is among the financial crimes. The legislator has
sentenced the crime of manipulation to protect individual and
institutional investors from market manipulations. Thus, deterrent
and effective enforcement mechanisms were envisaged in order to
ensure transparency and trust in the capital markets.
The capital market is a system in which financial intermediaries
are used to transfer the funds of the savers to those who request
funds. Fund demanders and fund suppliers establish relations
through capital market institutions. The crime of manipulation
regulated in Article 107 of the Law No. 6362 primarily regulates
the abuse of capital market instruments. A general definition of
capital market instruments is regulated in Article 3 of the Capital
Market Law as “other capital market instruments determined by
the Board to be within this scope, including securities and
derivative instruments and investment contracts”.
In order for a country to develop, the capital market should
have a transparent, stable, fair and secure structure. Since the
capital market is one of the cornerstones of the economic order,
capital market crimes are stipulated in the Capital Market Law in
order to ensure the healthy functioning and stability of the
market, and penal sanctions are envisaged for these crimes.
Market Fraud Crime
This crime can be committed in two ways, based on transaction or
information. In the transaction-based market fraud; regarding the
prices, price changes, supply and demand of capital market
Those who buy or sell in order to create a false or misleading
Those who give orders,
Those who cancel the order,
Those who change the order,
Those who perform account activities
punished with imprisonment from three to five years and a
judicial fine from five thousand days to ten thousand.
Legal and Material Subject of Crime of Manipulation
The first legal interest protected in the crime of crime of
manipulation is the national economy. The artificial manipulation
of securities affects the prices of goods and services, bank
interests in the short term, and the national economy directly
suffers from that. In addition, with the regulation of this crime,
the proper functioning of the capital market was also sought to be
protected. If these values are violated, the market will lack fair,
transparent, reliable, stable and competitiveness. Manipulating
capital market instruments in this way will adversely affect the
economic interests of investors who offer and purchase securities.
In the crime of transaction-based and information-based market
fraud, the material subject is capital market instruments.
As the perpetrator does not show any characteristics in terms of
transaction-based manipulation, it is not a specific crime.
Therefore, in the legal definition of the crime, “those who
make purchases or sell, give orders, cancel orders, change orders
or make account activities” are defined as perpetrators. Since
legal persons cannot be qualified as perpetrators, legal persons
will be judged and security measures specific to legal persons will
be in question.
There are debates about who the victim is in the crime of
manipulation. According to a view, the victim in the broad sense is
the state and the victim in the narrow sense is the investors.
Since the legal interest intended to be protected by the crime of
manipulation covers the society in general, the victim can also be
described as each individual that is a part of the society.
Transaction-based market fraud crime can be committed as
commissive. It has been regulated as a crime that can be committed
with an optional act because it is regulated as “… those who
buy or sell, give orders, cancel orders, change orders or perform
account movements in order to create a false or misleading
In this context, a framework agreement should be made between
the investor and the intermediary institution in order for capital
market instruments to be subject to purchase or sale. The investor
gives an order to the stock exchange member institution regarding
the purchase or sale of the security. This order is transferred to
the stock exchange system and a buy-sell transaction takes place by
overlapping with another party’s buy or sell order. In
transaction-based market fraud, the important thing is to match the
buying-selling transaction or to transmit the orders of the person
who wants to invest and the person who wants to sell to the stock
market. The crime in question is realized by the formation of
prices in the stock market and in the meantime the prices to be
affected by manipulation.
In case of placing an order, the investor gives an instruction
to the intermediary institution to purchase or sell capital market
instruments, and the result is realized when the instruction is
transmitted to the stock market through the intermediary
institution. If the orders transmitted to the system do not match
with counter orders in the market, the order can be canceled. In
return for a certain fee, the order can be canceled completely or
the amount of the order can be reduced. In case of cancellation of
the order, there is no need for the initial order to be unlawful,
its cancellation with a manipulative purpose is penalized.
Transactions transmitted to the exchange can be changed before
they are transacted on the exchange. This change of order is
carried out by intermediary institutions in accordance with the
principles specified by the Borsa İstanbul A.Ş. Board of
Directors. Performing account activities; making a transfer between
accounts means a transfer. By regulating account movements as one
of the optional forms of action within the scope of article 107, it
is aimed to prevent manipulation from being committed by using the
perpetrator’s own accounts or the accounts of others.
It is a crime that can be committed intentionally in terms of
the moral element of the crime. A specific motive is sought, since
the legal definition of the crime includes the phrase “with
purpose”. There is special intent. Therefore, the perpetrator
must act with specific intent in order to “create a false or
misleading impression”. For both forms of the crime regulated
under Capital Market Law article 107, indirect intent or negligence
will not be possible.
The reasons for justification is regulated in the article 108
of the Capital Market Law. In this context:
Applying policies of money, foreign exchange rate, public debt
management or realising transactions aimed at providing the
financial stability by the Central Bank of the Republic of Turkey
or another authorised official institution or persons acting on
behalf of them,
Repurchase programs applied according to the Board regulations,
share acquisition programs directed to workers or allocation of
other shares directed to the workers of the issuer or his/her
Making the purchase and sale of capital market instruments or
giving or cancelling orders for the purpose of supporting
exclusively the market price of these instruments for a
pre-determined period, provided that these operations are performed
in conformity with the regulations of the Board in the context of
this Law regarding the price stabilizing operations and market
maker, are not considered as manipulation. These reasons are
accepted as justification in the case of the transaction-based
Manipulative Transaction Types Determined by the Capital
The most common form of transactional manipulation is wash
sales; It is an apparent purchase and sale transaction, but the
ownership does not change because the buyer and seller are the same
person. If the parties agree in advance and ensure that the orders
are matched (matched order), it is the situation where another
investor knows that the time-quantity-price will meet the requested
orders. In addition, the methods of concentration (runs) and
impossible orders (spoofing), limiting supply (corner) and
opening-closing market manipulation are also considered as
The crime of information-based manipulation is regulated under
the paragraph 2 of Article 107 of the Capital Market Law is a crime
that can be committed by anyone, so that it is not a specific
crime. The victim is defined as every individual in the society,
since the value protected in both crime types is the same.
Information-based manipulation crime is also a crime with
optional act. In this context, “giving false or misleading
information, making rumors, giving news, making comments or
preparing reports or spreading them” is counted as an optional
act. If only one of these acts are happened, the crime is accepted
to be committed. Giving information about the values of capital
market instruments; It occurs in the form of giving false
information about the financial situation of a company by
deliberately increasing or decreasing some items related to its
The state of making rumors is seen as creating a negative
opinion in the form of revealing false information about capital
market instruments and saying that it is bankrupt. Making news that
will affect a company’s reputation in the stock market is one
of the elective acts within the scope of the crime. Because the
news spreads so fast, it creates a difficult situation for
investors, their reputation is damaged.
It is also considered as an optional move to comment on the
results of a certain event on the capital market and its
instruments, and to prepare a report reflecting the financial
situation in a way that arouses a wrong opinion.
Contrary to transaction-based manipulation, the crime of
information-based manipulation, which is regulated in the 2nd
paragraph of Article 107, is not a mere act crime. In the legal
definition of the crime, it is stipulated to provide benefits in
addition to the optional actions. For this reason, even if one of
the elective acts takes place, a crime will not occur without
Both transaction-based and information-based manipulation crimes
are crimes that are suitable for attempt. Since transactional
manipulation constitutes a purely act crime, an attempt is possible
if the transaction is divisible. In the case of information-based
processing, if the benefit could not be obtained because the
benefit was sought in terms of the result, the crime remained in
the attempt stage.
In case of transaction-based manipulation, if more than one act
is committed on different days within a certain time (1 month, 3
months, 2 years, etc.), successive offence provisions will be
applied. In the same way, a chain crime will also be in question if
multiple selective actions are carried out at different times
within the scope of a single information-based decision to commit
the crime of manipulation.
If more than legal provision is violated due to an act
committed, the penalty will be given according to the most severe
one. For example, in the case of information-based manipulation
(the official of the company active in the capital market gives
false information to influence the decision of the investors), the
crime of false information about companies or co-operatives
regulated in Article 164 of the TCC is also committed. Since the
penalty for the crime of information-based manipulation is higher
than the other, a ruling will be made in Article 107 of the Capital
It is possible to commit the crime of manipulation in the form
of co-perpetration, indirect perpetration, partner (incitement and
helping). In this context, the provision of Article 107 does not
have any feature in terms of complicity.
Both imprisonment and judicial fines are envisaged for
transaction-based and information-based manipulation offenses.
These two penalties are not optional; they are arranged together.
It is regulated that the judicial fine to be imposed in terms of
transaction-based manipulation should not be less than the benefit
obtained from the crime.
It is regulated that in case of transaction-based manipulation,
it will be punished with “three to five years imprisonment and
a judicial fine from five thousand days to ten thousand days”,
and in case of information-based manipulation, it will be punished
with “three years to five years imprisonment and a judicial
fine of up to five thousand days”.
Effective remorse provision is included in terms of
transaction-based manipulation regulated in Article 107/1.
According to this, transaction-based manipulation “the person
who committed the crime shows remorse and transfers money, not less
than five hundred thousand Turkish Liras, twice the amount of the
benefit she/he has obtained or caused to be obtained, to the
a) If he pays before the investigation starts, no penalty will
b) If paid during the investigation phase, the penalty to be
imposed is reduced by half.
c) The penalty to be imposed is reduced by one third, if paid
until the verdict is rendered during the prosecution phase.
Effective remorse has not been foreseen for the crime of
Pursuant to the decision of the First Chamber of the Council of
Judges and Prosecutors dated 09/05/2013 and numbered 864, the
Criminal Court of First Instance was appointed for the crimes
within the scope of the Capital Market Law.
In terms of crime of manipulation, the place where the crime was
committed is Istanbul, where Borsa Istanbul is located. Therefore,
Istanbul Criminal Courts of First Instance was authorized.
Coşkun, Seçil. Manipulation Crime in the Law of
Capital Market. (Ankara: Ankara University, Institute of Social
Sciences, Master’s Thesis, 2020).
Duman, Buminhan. Manipulation Crime (Manipulation) in the Law of
Capital Market (Ankara: Adalet Press, 2020).
Paşaoğlu Köroğlu, Duygu. Manipulation Crime
in the context of Art. 107 of Capital Market Law (İstanbul:
Medipol University, Institute of Social Sciences, Master’s
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