Over 20 detained in Istanbul Gold Refinery investigation

ISTANBUL

Turkish authorities have detained 22 individuals linked to the Istanbul Gold Refinery and associated companies on charges of obtaining state support through fraudulent means, media reported on Oct. 6.

Simultaneous raids were conducted across a dozen districts of Istanbul after prosecutors issued detention warrants for 23 people, with one still at large.

The Istanbul Gold Refinery, owned by the Halaç family, is one of the London Bullion Market Association (LBMA)-accredited refineries, according to Türkiye’s official trade registry.

According to a statement from the Istanbul chief prosecutor cited by media, the Istanbul Gold Refinery officials, including main shareholder Özcan Halaç, allegedly established companies to claim a 3 percent state subsidy on $543.6 million in exports, resulting in an estimated $12.5 million loss to the state.

The investigation reportedly revealed that the refinery received state support for selling foreign currency to the Central Bank in exchange for Turkish Liras, as part of a government incentive aimed at strengthening the Turkish currency.

Authorities found that the companies imported raw gold, refined it in local gold mines, then treated the refined gold with acid solutions to make it appear processed before legally exporting it, generating foreign exchange revenue through this scheme.

The suspects face charges of violating the Central Bank Law, public finance regulations and legislation related to the protection of the lira’s value.

A Forbes article noted that the Istanbul Gold Refinery is among 65 LBMA-accredited refineries worldwide and has an annual processing capacity of 1,380 tons of gold.

If operating at full capacity, the refinery could meet the annual global demand of approximately 4,500 tons of gold.

The Halaç family’s business roots trace back to the Istanbul Gold Refinery, founded in 1996 with support from the Turkish Treasury and the Istanbul Gold Exchange.

Ömer Halaç established Halaç Jewelry Limited in 1995, initially focusing on gold refining to meet the growing market’s needs. The company became active in Istanbul’s Grand Bazaar gold market and merged with Istanbul Gold Refinery in 2002. With a majority stake, the Halaç family took over the management of the refinery. The firm also pioneered gram gold production in Türkiye.