In the exchange rate increases in 2018 and 2019, the government described this as a “financial attack” and claimed that there was an “artificial price formation”. Within this framework, amendments were made to the Banking Law with the regulation published in the Official Gazette on February 25, 2020.
A new item was added to the Banking Law under the title of “manipulation and misleading transactions in financial markets”. 5% of the total interest, dividend income, fees and commissions and banking service incomes included in the financial statements of the previous year, not less than twice the benefit provided to the banks, which are engaged in the purpose of providing price formation including artificial supply, demand or exchange rate in the financial markets. Until, administrative fines were imposed.
The Regulation on Manipulation and Misleading Transactions in Financial Markets prepared within this framework by the Banking Regulation and Supervision Agency (BRSA) was published in the Official Gazette today.
Accordingly, the following actions performed by banks will be considered as manipulation and misleading transactions and practices in financial markets covered by Article 76 / A of the Law:
a) Intentionally to provide these purposes in transactions that provide or may provide false or misleading impression of the supply, demand or price of a financial instrument, or that may or may ensure that the price of a financial instrument, including exchange rate and interest, be kept at an abnormal or artificial level. ordering such transactions or engaging in similar activities.
b) To be involved in the transactions that will affect the price of a financial instrument or reference values such as interest, exchange rate, CDS, in order to increase the irregularity of the financial markets or negatively affect the stability of the financial markets by benefiting from the fluctuation or shallowness of the financial markets in times when the supply-demand balance is not realized under normal conditions, mediating, ordering such transactions or engaging in similar activities.
c) Early redemption of transactions, limitations, transactions, and / or deferred transactions made by the Board regarding the currency swap, forward, option and other derivative transactions made by banks with foreign residents, or the foreign liquidity of the banks by TL. To carry out or mediate such transactions and practices to overcome the obligations, including failure to fulfill them, by using indirect methods or to neutralize such Board decisions.
ç) To be involved in transactions that affect or may affect the price of a financial instrument including exchange rate and interest through a deceptive mechanism or setup, to mediate, to place orders or to perform similar activities.
d) Any false or misleading information or rumors, including the Internet, that may or may either give false or misleading impression of the supply, demand or exchange rate and interest price of a financial instrument, or that may or may ensure that the price is kept abnormally or artificially, disseminate through the mass media or in another way.
e) To try to make an impact on the price of a financial instrument, including the interest rate and the exchange rate, by providing opinions about a financial instrument that has been previously positioned, by hiding the conflict of interest regarding the position taken from the public, via the Internet or other mass media.
f) conveying false or misleading information about a reference value, providing false or misleading inputs, or taking any manipulating behavior to calculate a reference value, even though he or she knows or should know that it is false or misleading.
g) Taking actions to fix the purchase and sale prices of the financial instrument or to provide another unfair gain by using the dominant role on the supply or demand of a financial instrument.
ğ) In the opening and closing of the financial markets, to ensure the misleading of investors who take positions according to these opening or closing prices by performing purchase or sale transactions that may affect or affect the opening or closing prices of a financial instrument, including interest and exchange rate.
h) To direct savers in a false or misleading way.
ı) To disseminate information and rumors that may harm the trust in the financial system and cause systemic risk.
