The firm started business with a bang in January of 2018, when it imported about $41 million worth of gold from Venezuela, the first such transaction between the two countries in records that go back 50 years. The next month its volume more than doubled, with Sardes transporting almost $100 million worth to Turkey.
By November, when President Donald Trump signed an executive order authorising sanctions on Venezuelan gold -- after sending an envoy to warn Turkey off the trade, Sardes had shuttled $900 million of the precious metal out of the country. Not bad for a company with just $1 million in capital, according to regulatory filings in Istanbul.
It’s not the first time that Turkey has positioned itself as a work-around for countries facing U.S. sanctions, potentially undermining Washington’s efforts to isolate governments it considers hostile or corrupt. Ankara has often tested the boundaries of US tolerance, and the alliance between the key NATO members is now essentially broken, according to two senior US officials.
Long one of America’s most valued partners in a region straddling Europe and the Middle East, Turkey has increasingly found common interests with authoritarian countries such as Russia, China, Iran and Venezuela. When National Assembly leader Juan Guaido declared himself Venezuela’s rightful president last month, the US and many other Western countries rushed to declare their support for him. Turkey aligned itself with those behind Maduro.
It’s unclear what underpins Turkey’s support for Maduro beyond a general opposition to US meddling and efforts to overthrow nominally-democratic governments. Erdogan faced a coup attempt in 2016 and has fashioned himself as a champion of elected leaders everywhere, even where votes were widely considered neither free nor fair. Economic ties between the two nations are barely a factor: Venezuela doesn’t rank among the top 20 trading partners for Turkey, according to data compiled by Bloomberg.
But that doesn’t mean Erdogan can’t use Turkey’s $850 billion economy, the largest in the Middle East, to help friends in need. While Sardes’s gold corridor appears to have closed in November, there are other avenues. A Sardes spokesperson did not respond to a request for comment.
Erdogan travelled to Caracas in December to introduce the Venezuelan leader to Ahmet Ahlatci, chairman of one of Turkey’s largest gold refiners. The next month, Maduro’s close ally Tareck El Aissami reciprocated with a visit to an Ahlatci refiner in the central Turkish city of Corum. Turkey’s pro-government media reported that Venezuelan gold would be processed there.
That never materialised because Ahlatci was wary of falling foul of US sanctions, according to a person with direct knowledge of the visit. Instead, El Aissami surveyed refining technology to try and replicate it back home, the person said, asking not to be identified because of the sensitivity of the matter.
An Ahlatci executive was among business leaders who last week met Marshall Billingslea, an assistant secretary at the U.S. Treasury responsible for combating terrorist financing, who was in Turkey on a twice-yearly visit, according to a participant in the meetings. Billingslea warned the group to avoid dealing with what he called El Aissami’s “blood gold,” the person said, asking not to be identified discussing a private meeting.
Ahlatci did not return calls by Bloomberg. His son, Ahmet Metin, said by phone the company “won’t comment.”
Billingslea’s priority in Turkey wasn’t Venezuela, but compliance with sanctions on Iran, according to two people familiar with the matter. Some US officials have said they’re concerned there could be a connection between the two, though no evidence has been presented so far to suggest there is.