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Mystery Surrounds The ‘Fort Knox’ of Massachusetts

Mystery Surrounds The ‘Fort Knox’ of Massachusetts
0 comments, 08/09/2010, by , in News

Most people outside Massachusetts do not know where this town is, never mind that it is home to one of the country’s biggest gold refineries, a place that regularly churns out gleaming ingots.

Yet Metalor USA Refining Corp. is situated, nonchalantly enough, in an office park here. The concrete compound’s discreet green-and-brown exterior blends into the woodsy landscape, though the seemingly endless razor-wire fencing surrounding it sends a clear “stay out’’ message.

And that’s exactly how Metalor likes it.

“It’s like Fort Knox,’’ said Paul Belham, vice president of the North Attleborough Industrial Park Tenants Association, which represents businesses in the park where the company is located. “They’re very secretive over there.’’

The plant, a vestige of the region’s once grand jewelry making, is one of a handful of US refineries that make prized bars of nearly 24-carat gold. Known as “four-nines,’’ they are stamped 999.9 to indicate they are nearly pure gold.

Gold moves in and out of the Metalor plant in armored trucks, but exactly where the gold comes from or where it goes is rather mysterious. Competitors and several consultants either declined to speak about the company or did not return phone calls. And when they did, details were slim.

John King, president of the New England Chapter of the International Precious Metals Institute, an industry group, said Metalor “deals with mines.’’ As for its clandestine ways, he had only one explanation: “Metalor is Swiss-owned, so that’s probably another cultural aspect to the secrecy.’’

The refining business has benefited from the global recession, as jittery investors’ demand for gold has pushed prices to record highs. A troy ounce of 24-karat gold is now worth more than $1,200, a nearly 400 percent increase in value over the last decade. Today, a single gold bar of 400 Troy ounces, like the kind produced by Metalor, is worth nearly $500,000.

Boston’s State Street Corp. keeps scores of those heavy gold bars made by Metalor in a London vault to back its gold fund, which is the world’s largest and currently valued at $50 million. Yet even Jim Ross, a senior managing director and a founder of the fund, said he did not know that many of the gold bricks came from Metalor’s North Attleborough plant.

Metalor’s gold-brick manufacturing business has been thriving, according to parent company Metalor Group’s annual report. The group’s refining unit, which includes the North Attleborough plant, has been operating at maximum capacity.

But a spokeswoman for Metalor Group at its headquarters in Neuchâtel, Switzerland, declined to answer questions — even about basics like number of employees — citing security concerns and corporate policy. “We trust you understand our position,’’ she wrote in an e-mail.

In North Attleborough, where Metalor is not a household name, local historians view such refineries as part of the region’s rich jewelry-making heritage. The area from the neighboring town of Attleboro and south to Providence was home to scores of refineries and jewelry makers through the 1950s.

Today, many of the larger operations, like ring maker L.G. Balfour, are gone. In 1997, after 83 years of business in Massachusetts, its owners moved the plant to a Texas border town to take advantage of cheaper labor.

“That’s the story of a lot of companies in Attleboro,’’ said George Shelton, executive director of the Attleboro Area Industrial Museum, which operates in a defunct refinery. “Now the remaining companies are in industrial parks and people don’t see them, they don’t go there unless they work there. And Metalor doesn’t necessarily want to advertise its address.’’

Metalor, like Fort Knox, the Kentucky home of much of the country’s gold supply, exists in unexpected if not remote locations. But Fort Knox is famous: Its vault temporarily housed a Magna Carta and the Hungarian crown jewels during World War II, and the fortress was the setting for 1964 James Bond classic “Goldfinger.’’

Metalor has none of that intrigue and looks like an ordinary factory, at least until you get to the building’s entrance. A sign posted next to an intercom instructs visitors: “Identify Yourself!’’ and any loitering draws security personnel.

Such precautions are warranted. Two years ago, thieves stole more than $2 million worth of jewelry from a manufacturer six miles away.

An Attleboro police detective, Richard Campion, said the thieves disabled the alarm systems at E.A. Dion Inc., cutting a hole in the roof and extracting a 3,000-pound safe and 52 Super Bowl rings made for the New York Giants. An account in the local newspaper, The Sun Chronicle, described the heist as orchestrated by “master thieves operating with military-like precision.’’

Campion said several police agencies collaborated on the case, arresting suspects and recovering 30 of the rings. Police also meet routinely with businesses like Metalor to talk about safety. He did not elaborate.

“I don’t know anything about Metalor,’’ Campion said. “That’s part of the security — not to put it out there.’’

One former employee, who did not want to be identified because he signed a confidentiality agreement, said the plant buys mined gold as well as gold from pawn shops, jewelers, and dental offices. While some of the gold is turned into 100- and 400-troy-ounce bars, like the kind bought by banks, some is sold to the jewelry industry.

“Metalor is a very good company,’’ he said. “Very up and up.’’

Yet Metalor has not been entirely successful in keeping a low profile. In 2004, the Associated Press reported that Metalor was involved in illegal financial transactions that resulted in the laundering $4.5 million in drug money.

According to the story, an investigation by the US Immigration and Customs Enforcement agency revealed that couriers were picking up gold refined at Metalor and repackaging it in shampoo bottles and other containers they smuggled into South America. The company agreed to pay a $2.25 million fine and forfeit $423,000 in profits.

Despite the case, many residents of Jewelry City, as Attleboro is known, said they knew little about the gold bricks in their midst.

On a recent morning, Judy Erickson, a waitress at Morin’s diner in downtown Attleboro whose father worked as a diamond setter, served breakfast to a steady stream of customers.

“The name sounds familiar,’’ she said when asked about Metalor, but “I don’t know what for.’’



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