Erkan Kork, the prominent chairperson of BankPozitif and digital payments provider PayFix, found himself at the heart of a major financial scandal when Turkish authorities arrested him on March 18, 2025, in Istanbul. This high-profile operation targeted illegal gambling and money laundering, exposing a sophisticated network allegedly facilitated by Kork’s leadership in PayFix. With 52 individuals detained and businesses like BankPozitif, PayFix, and Flash TV seized, the case underscores Turkey’s relentless fight against unauthorized betting. This article delves into the details of Kork’s arrest, the role of his companies in enabling illicit activities, and the broader implications for Turkey’s financial and gambling sectors.

The Operation: A Sweeping Crackdown

On March 18, 2025, Turkish police conducted extensive raids across Istanbul, detaining 52 suspects, with 21, including Erkan Kork, formally taken into custody. The operation aimed to dismantle a network accused of laundering funds from illegal gambling through digital payment systems. Prosecutors allege that Kork integrated illegal gambling operations into PayFix’s infrastructure, processing approximately 50 million betting-related transactions worth around $110 million. These funds were reportedly funneled to cryptocurrency exchanges, highlighting the sophisticated methods used to obscure illicit financial flows. The seizure of Kork’s affiliated businesses, including BankPozitif, PayFix, and Flash TV, marks a significant escalation in Turkey’s efforts to curb financial crimes linked to illegal betting.

BankPozitif, a boutique bank acquired by PayFix from Israel’s Bank Hapoalim in 2023, was transferred to Turkey’s Savings Deposit Insurance Fund (TMSF) following the arrests, as announced by the Banking Regulation and Supervision Agency (BDDK). The Central Bank of the Republic of Türkiye (CBRT) also suspended the operational licenses of PayFix and two other payment firms, Ininal and Aypara, for non-compliance with Turkish laws. These decisive actions reflect the government’s commitment to rooting out entities that enable illegal activities.

Turkey’s Strict Gambling Regulations

Turkey maintains a tightly controlled gambling environment, with the government holding a monopoly over legal betting activities. Casinos have been banned since 1998, and non-state online gambling was outlawed in 2006. The state-run Milli Piyango (National Lottery) and authorized betting services like IDDAA are the only legal gambling options. Despite these restrictions, illegal gambling, particularly in professional football, thrives, with an estimated economic impact of 300 billion Turkish Liras (€8.4 billion) annually, according to Hürriyet. The accessibility of online platforms and the promise of quick profits drive this underground market, often facilitated by digital payment systems like PayFix under Erkan Kork’s oversight.

Illegal gambling operations exploit fintech platforms to process transactions discreetly, bypassing traditional banking oversight. The allegations against Kork suggest that PayFix’s infrastructure was manipulated to support foreign-based virtual betting sites, using software integrated into “panels” to enable seamless payments. These panels, combined with fraudulent accounts, masked the origins of illicit funds, constituting a money laundering scheme that has drawn intense scrutiny from regulators.

Erkan Kork’s Role in PayFix and BankPozitif

Erkan Kork’s leadership of PayFix and BankPozitif placed him in a position to allegedly orchestrate a complex illegal gambling operation. Prosecutors claim that Kork deliberately incorporated gambling activities into PayFix’s payment systems, enabling the processing of millions of illicit transactions. The funds were reportedly directed to cryptocurrency exchanges, obscuring their trail and complicating regulatory efforts. Additionally, Kork is accused of using illicit profits to acquire BankPozitif, further entangling the boutique bank in the scandal.

The seizure of BankPozitif and its transfer to TMSF underscore the severity of the allegations. PayFix’s role as a digital payments provider made it an ideal vehicle for facilitating illegal betting, as its infrastructure allowed for rapid, high-volume transactions. The involvement of a prominent figure like Kork raises questions about the adequacy of oversight in Turkey’s fintech sector and the vulnerabilities of digital payment platforms to exploitation.

Broader Implications for Turkey’s Financial Sector

The arrest of Erkan Kork and the seizure of his businesses have significant implications for Turkey’s financial and fintech industries. The suspension of PayFix, Ininal, and Aypara’s licenses signals a broader crackdown on payment providers suspected of regulatory violations. The CBRT’s actions demonstrate a zero-tolerance approach to financial crimes, particularly those linked to illegal gambling. By targeting high-profile figures like Kork, authorities aim to deter other institutions from engaging in or enabling illicit activities.

The transfer of BankPozitif to TMSF is intended to stabilize the institution and restore public trust, but the scandal may undermine investor confidence in Turkey’s fintech sector. As a growing market for digital payments, Turkey risks reputational damage if similar incidents recur. The case could lead to stricter regulations and enhanced oversight of fintech companies, potentially limiting their operational flexibility but strengthening the integrity of the financial system.

Illegal Gambling: A Persistent Challenge

Illegal gambling remains a persistent issue in Turkey, despite repeated crackdowns. In 2019, authorities issued arrest warrants for 394 individuals and targeted 72 front companies involved in illegal betting, revealing a network generating billions in revenue. The 2023 Operation Mengene apprehended 650 individuals and shut down 13 establishments linked to illicit gambling. These operations highlight the scale and complexity of the problem, with funds laundered through sectors like cosmetics, logistics, and food.

The rise of social media has further complicated efforts, with influencers promoting illegal betting sites to large audiences. In November 2024, arrest warrants were issued for figures like Yasin Obuz for advertising unauthorized platforms. The government’s multifaceted approach targets both financial facilitators, like Erkan Kork, and those who promote illegal gambling, aiming to disrupt the ecosystem supporting these activities.

Government Response and Future Measures

Under President Recep Tayyip Erdoğan’s AKP government, Turkey has maintained strict control over gambling since 2014, with no plans to liberalize the sector. Finance Minister Mehmet Şimşek has highlighted the economic threat posed by illegal gambling, which undermines tax revenues from state-run enterprises like Milli Piyango and IDDAA. In January 2025, Şimşek ordered intensified efforts against illegal gambling websites, resulting in the blocking of 233,000 sites over two years, with 56% originating from the USA and 17% from Armenia.

The Treasury and Finance Ministry is developing an action plan to monitor social media platforms, which have become key channels for promoting illegal betting. Proposed measures include stricter fines and imprisonment terms of 3 to 6 years for those involved in illicit activities. These initiatives aim to deter operators and facilitators, ensuring the integrity of Turkey’s financial system.

Case Study: Papara Investigation

The crackdown on Erkan Kork and PayFix is part of a broader effort targeting fintech companies. In May 2025, authorities detained 13 individuals, including Papara’s founder, Ahmed Faruk Karslı, in a probe into illegal betting and money laundering. Investigations revealed that 102 of Papara’s 26,012 accounts were used on illegal betting sites, with funds transferred to 274 bank accounts and 16 cryptocurrency wallets. This case, like Kork’s, underscores the vulnerabilities in Turkey’s fintech sector and the need for robust regulatory frameworks.

Economic and Social Impact

Illegal gambling has a profound economic and social impact in Turkey. The €8.4 billion annual market reflects lost tax revenue and victimizes citizens through fraudulent schemes. A June 2025 case in Ankara, where a woman was defrauded while betting on an illegal site, highlights the risks to individuals. Socially, illegal gambling fuels addiction and financial distress, particularly among young people and sports fans. High-profile cases, like that of pop singer Serdar Ortaç, who received a suspended 10-month sentence for promoting illegal gambling, illustrate the issue’s cultural reach.

International Context and Comparisons

Turkey’s efforts align with global initiatives to combat illegal gambling and money laundering. The global sports betting market, valued at $1–3 trillion annually, is largely driven by illicit activities, with 90% of bets placed outside regulated frameworks. In Asia, particularly China, illegal football betting thrives, often facilitated by digital platforms and cryptocurrencies. Turkey’s challenges mirror these trends, compounded by its strict regulatory environment. Unlike the UK or US, which have more liberalized markets, Turkey’s prohibitive approach reflects its socio-political context, prioritizing state control over gambling.

Challenges and Criticisms

Eradicating illegal gambling remains challenging due to cryptocurrencies and offshore servers, which obscure transactions. The rapid growth of fintech platforms, as seen in Erkan Kork’s PayFix, has outpaced regulatory frameworks, creating exploitable loopholes. Critics argue that Turkey’s strict laws may drive betting underground, complicating oversight. Proposals for a regulated online gambling market, similar to Europe’s, face resistance under the current administration. The seizure of businesses like BankPozitif and PayFix also raises concerns about legitimate operations and job security, necessitating a balance between enforcement and economic stability.

Future Outlook: Strengthening Enforcement

Turkey is likely to maintain its aggressive stance against illegal gambling, with plans to monitor social media and revise criminal codes. Enhanced cooperation with banks and fintech firms, coupled with AI-driven transaction monitoring, could strengthen enforcement. Public awareness campaigns may reduce demand for illegal platforms, while privacy considerations will be critical to avoid overreach. The case of Erkan Kork serves as a warning to financial institutions, signaling that regulatory compliance is non-negotiable.

Conclusion

Erkan Kork’s arrest and the seizure of BankPozitif and PayFix highlight Turkey’s unwavering commitment to combating illegal gambling. The operation exposes the vulnerabilities of digital payment systems and the challenges of regulating fintech in a rapidly evolving landscape. While progress has been made, the persistence of illegal betting calls for comprehensive strategies addressing both supply and demand. As Turkey strengthens its enforcement measures, the case of Erkan Kork will remain a pivotal moment in the nation’s fight to protect its financial system and uphold its strict gambling regulations.