US Links Erdogan To "Secret Gold" Trade With Iran; Lira, Bonds Tumble

Tyler Durden's picture

While long forgotten for some, in the summer of 2014, we reported in detail on what appeared to be the biggest, most bizarre money-laundering scheme ever, involving Turkey trading "200 tons of secret gold" with Iran...

The topic of Turkey's Oil-for-Gold 'deals' has not been far from our thoughts over the last few years (here, here, and here) but as Bloomberg reports, after accessing a report leaked on March 14 of a network that spanned Turkey, China, Dubai and Iran, the plot reveals "one of the most complex illicit finance schemes [prosecutors] have seen." It included the classic money-laundering techniques of over-invoicing and false invoicing (exactly as in the case of the Chinese commodity financing scandal underway) but the secret government plan to juice Turkey's exports goes much deeper; and if you think that the exposure of this scheme is slowing Turkey's manipulation, think again. Turkey’s trade balance continues to fluctuate unpredictably as gold stocks flow out of the country in bursts.  “Turkey’s going to continue it,” the Turkish economy minister said. “If those casting aspersions on the gold trade are searching for immorality, they should take a look in the mirror.”


We first started noticing major 'odd' exports of gold from Turkey to Iran in May 2012. But in 2013, with a plunging currency, surging inflation, slowing growth, and specter of rapid QE-driven hot money outflows leaving his nation desperate; Zafer Caglayan, the minister in charge of Turkey's $800 billion economy decided that the only way to ensure success in the looming election... was to cheat...


Read more here...

A farcical domestic investigation was undertaken and while the judges and officials who probed the money laundering scheme were either fired or reassigned, the findings in their report were leaked.

The leaked document that Erodgan tried so hard to hide, prepared by the Turkish National Police, shows that investigators probed the activities of a cast of characters that was both powerful and dependent upon each other for favors. There have been some arrests (but no politicians)

The first was Sarraf, the Iranian businessman, who changed his name from Reza Zarrab after he took Turkish citizenship in 2007.


He and Erdogan were photographed on stage together at one public function, and met at a wedding in Ankara.


After Sarraf was arrested in December, Erdogan told reporters that his gold-dealing had “contributed to the country.”

And now three years later, Bloomberg reports that Zarrab - the gold trader accused of helping Iran evade sanctions - invoked the name of Turkey’s president, Recep Tayyip Erdogan, as part of a scheme that U.S. prosecutors say was supported by Turkey’s government, according to court documents.

U.S. prosecutors in New York have gathered taped conversations and other records that suggest the trader may have sought support from Erdogan.


The Turkish president hasn’t been accused of wrongdoing, and it’s possible that the trader falsely invoked Erdogan’s name to influence others.


The people charged in the case are captured in the recorded conversations, which were introduced in a filing in federal court in Manhattan.


The documents introduced in the sanctions and money-laundering case against the Turkish-Iranian gold trader, Reza Zarrab, could further complicate the relationship between the U.S. and Turkey, a majority-Muslim country long considered a crucial ally in the region.

And the fallout from this latest uncertaintyis clear as Turkey's Lira tumbles to 2017 lows - near record lows...

And Bond yields are spiking to record highs...

“The Zarrab case is the one to watch in terms of U.S.-Turkey relations,” Tim Ash, a London-based strategist for BlueBay Asset Management LLP, said in an email to clients.


“Zarrab is thought to have been close to the Erdogan family and, indeed, he was given Turkish citizenship, alongside Iranian. This is a real stress point."

As Bloomberg notes, Erdogan tried to pressure U.S. officials during the Barack Obama and Donald Trump administrations to drop the prosecution of the trader and has complained in public comments that prosecutors were trying to extract a confession from Zarrab and turn him into an informant. He also claimed President Trump apologized for the prosecution in a phone call.

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tmosley's picture

>yfw oldbugs begging for crypto bans get gold banned instead


Pliskin's picture

I upvoted you for being a good sport...

nope-1004's picture

Love the tone of the article.  "Prosecutors in New York......"

lmao.  In other words, other nations are not allowed to trade gold for goods!  You must trade what we tell you to trade, and use our system, our currency, because dog -gonit, that's how we can control you.  lol. 

nope-1004's picture

The arrogance is mind blowing.


BennyBoy's picture


Gold trade has been known

Buying Iraq oil from ISIS then reselling it at a discount to Israel is known.

His family ships and trucks etc were all involved.

US/CIA trying to brand Turkey as BAD when last year when all this was knwon Turkey was GOOD.

Only US/CIA spinmachine changed.

BobEore's picture

It had to happen - sooner or later.
After months/years/ whatever - of avoiding the name Reza Zarrab like the plague -

as well as what I noted repeatedly this past winter,

would be the 'trial of the century'/// up pop on the zheeple register a mention of the ////GOLD FOR OIL TRADER/// at last!

Instead of the usual back patting... for back dated stories which never never penetrated to the heart of the black oil darkness behind this story of stories... our media masterz might exercise indeed some version of humility about

missing out on the real deal of the STEAL!

a STORY... in other words... which only dogged ink-stained 'retro-reporters' would dare dig out, following the $ trail not to dead end letter boxes in GULF STATES...


but lets' not talk bout that... or Preet ... or Flynn or the rest o the news without noxious noahide overtones!


auricle's picture

the biggest, most bizarre money-laundering scheme ever, involving Turkey trading "200 tons of secret gold" with Iran...

Umm no, that is called a financial transaction? What authority does the USA have over two countries trading commodities? 



falak pema's picture

Chronologically it occurred BEFORE the ban on Iran trade was raised by Obama.

So Pax Americana decides who is BAD and who is GOOD; as ANY country who bucks that rule is excluded by the FED's swap agreements as far as their banks are concerned; making those countries unable to do export trade (all commodity future and spot trades are $ dependent)...

The "our money your problem" hegemony since Friedman became king of Money and economics.

2008 crisis sunk that boat under debt but QE/ZIRP have hidden it under the carpet until someone says : The Emperor is naked. 

Which is why Putin has taken over OPEC and drawn the red line in Syria along with Iran and soon with Erdogan as well. 

Even the Sauds have to accept Putin as the Count of Gazprom; as will Mutti and EU down the line.

So say hello to China rising on that groundbreaking work done by the new count of Monte Cristo.

RafterManFMJ's picture

Exactly what I was wondering. No damn wonder they’re buying Russian SAMs. Faster, please.

JRobby's picture

This scheme ran outside of CB's spectrum of gold manipulation tactics so it must be prosecuted.

Son of Captain Nemo's picture

">yfw oldbugs begging for crypto bans get gold banned instead


That "worthless barbaric relic" that still finds itself on the "motherboards" of computers that squeeze out "Buttcoin"!...

Yeah!... Absolutely right tm!!!

tmosley's picture

>yfw bitcoin miners wind up with all the gold

>yfw they didn't even want it


Pliskin's picture

It's a 'barborous relic' that's why the U.S. regime has got rid of it, and filled Fort Knox with Bitcoins...

Mnuchin told me that!  He told me he banged his missus on a Yuge stockpile of Bitcoins, and she fucking loved it!

N.B. I might of been lying about that last one!!


Son of Captain Nemo's picture

">yfw bitcoin miners wind up with all the gold

>yfw they didn't even want it


Yeah tm... More proof that the CBs are trading fiat paper for electronic crypto wallets that attempts to control all of it... Same shit different century!

That's the plan of course... TILL IT ISN'T!... And I might add WHILE SUPPLIES LAST ( AND THIS TIME IS DEFINITELY DIFFERENT if you happen to reside in the Continental U.S., Britain and Western Europe!


VD's picture

the transaction volume of bitcoin over last 12months is, on average, unchanged. while price has gone up 10x.


Son of Captain Nemo's picture

Same "LLC" VD that controls the S&P/NYSE and NASDAQ!

VD's picture

met w/ money manager last night and he told me he was speaking with US investors that set up btc mining operations in China circa 2012 and they killed it; he said he's kicking himself for not "investing" in btc and i replied that if he thinks it's so viable why not put some money in now and he shook his head and said no way.

tmosley's picture

>I don't understand supply and demand when supply is fixed


Son of Captain Nemo's picture

You're either being deliberately "silly" or "stupid" with comment(s) like this!

Jack's Raging Bile Duct's picture

As a point of order, 2 "forks" later is not a fixed supply in BitCoin. The sea of equivalents also contest the notion of a fixed supply.

webmatex's picture

Just a place to put some cash.

MozartIII's picture

Its how you sell smuggled oil from Syria on the black market. Only a story in the US due to demise of the petro dollar.


This is not a Gold story, its about OIL! Yes Gold is still a trusted currency around the world, used by governments. Oh the shock....

Consuelo's picture



What man makes artificially does not equal nature's scarcity.



Pliskin's picture

When the electric goes off, I've still got my gold!

Ron_Mexico's picture

I thought you were dead . . .

tmosley's picture

Yeah, man is much better at enforcing scarcity by using algorithms. Nature fucks up bad whenever mad gets some new tech, allowing supply to explode. Happened with seafaring ships, is in the process of happening with automation+cheap power, and will happen again with asteroid mining.

Badsamm's picture

Nobody cares about the American dumpster fire anymore.
I had a 110 lbs black Lab once, the day the neighbor cats realized he lost a step, his food bowl was fair game. Soon enough, he started shitting all over himself and then he died.

Good luck

bardot63's picture

Gold banned by whom?  Central Banks?  China?  Russia?  The entire mid-east? S. America? Africa?   Even the US does not ban gold.  Where did you go to school? 

DjangoCat's picture

US certainly did ban gold.  Now they probably don't have any.

bardot63's picture

You are dead wrong.  The US in 1933 banned the use of gold as money.  It did not ban owning gold.  Every citizen was allowed to keep gold, to the tune of up to $100 in gold per person (100 million population), along with rare gold coins, gold meant for jewelry and gold meant for export.   Read FDR's order.  And find a new myth to perpetuate.  Except for toadies who loved and adored governments, most citizens did not surrender their gold in '33.  the evidence is pre-33 gold available today.   Today, gold is legal to own and in some places, including a few US states, it is legal tender, and is used for money throughout the world except in the US, which is populated by sadly misinformed morons.

Maestro Maestro's picture

You're lying.

Americans were forbidden to hold gold bullion bars and bullion-related gold coins until the '70s. The reason there are so many pre-'33 gold coins is because wealthy American citizens sent them overseas and ILLEGALLY hoarded them in Europe out of the reach of the American government. Many others also unlawfully refused to turn them over to the government. That's why there were so many American gold coins in Europe, probably more than there were in the US proper until the turn of the new century.

LawsofPhysics's picture

So Erdogan is being thrown out of the "petrodollar club"?

Soon to join the BRICs currency union?

do tell, do tell...

Justin Case's picture

The global police department is controlling the world financial transactions. How dare anyone think that they can do business without the empire's approval? Only the corrupt global police are free to do what ever screws up other countries and money laundering without anyone's approval. It's known as hypocrites.

Son of Captain Nemo's picture

Fuck the purchase of SA-400s from the Russians... This is what is severely "pissing off" the Zionist overlords!

Pliskin's picture

I don't like Erdogan, I think he's a sneaky cunt, but i would fucking love to see the U.S. try and invade/occupy/colour revolution Turkey..Hahaha, there'd be SO MANY dead american mercinaries it'd be hilarious!!  Go on NATO, give it a try!  It'd make for some great T.V.


Son of Captain Nemo's picture

"I don't like Erdogan, I think he's a sneaky cunt"...

He's Netanyahu personified Plisk. The Russians better watch their "six o'clock" with the Turks at all times and at all costs.

The only way I would ever sell my military hardware to them is if Russia institutes the same rules that the U.S. military does in place like Riyadh. YOU "BUY IT" BUT "WE OWN IT"... including the Russian military operating it 24/7!

illuminatus's picture

Well, they did try a coup, it backfired.

HRClinton's picture

I upvoted you for objective reasons (your argument) and subjective reasons (you avatar of Kurt R).

Kurt's just a plain cool dude, you gotta admit that.

Mr Twitch's picture

NATO could just bomb Turkey back to the 1800s, leave and then seal off the borders. 

webmatex's picture



NATO could just bomb Turkey back to the 1800s, leave and then seal off the borders. 


Thats why Turkey bought the ss300 in the first place.

illuminatus's picture

My take is that most heads of state around the world are tired of genuflecting to the current hegemon, and if they get a whiff of weakness they will change allegiances in a New York minute. Using the stick too often has consequences.

Consuelo's picture



Gotta credit Uncle Jim Willie again here (and his merry band of crack side-kicks) for calling this way long ago.

Quinvarius's picture

What this shows is that the advantage the US had in having US dollar as the dominate currency had nothing to do with the ability to  ban people from using it.  In fact, any advantage the USD dominance held completely evaporated when they tried to use it as a weapon.  That tells you right there the politicians and bankers don't understand the limits of financial power.  And in the hands of fools, it disappears.