This presentation explores a captivating corruption case during the Late Ottoman Empire. Agob Boyacıyan, a prominent merchant of Armenian origin in Istanbul, forged an illicit collaboration with Mehmed Ali Pasha, the Minister of Postal Service and Telegraph. Boyacıyan was entrusted with the critical task of supplying material to the ministry and entered into a contractual agreement with it. Though Boyacıyan promised the delivery of goods amounting to a substantial two million Ottoman Lira, he and the pasha absconded with the funds, leaving the state bereft of essential supplies. What ensued was not a case of embezzlement but a web of deceit that implicated high-ranking officials during a period when state elites attempted to modernize bureaucratic affairs and fight against corruption and bribery. Initially shrouded in secrecy, Mehmed Ali Pasha attempted to conceal the malfeasance. As the gravity of the corruption became apparent, however, the scandal burst into the public sphere, casting a shadow on the government’s reputation. This scandal resulted in months-long tensions between different levels of state institutions and the Istanbul Chamber of Commerce and Industry as the chamber vouched for Boyacıyan, who had served as a manager in this organization for years. Despite efforts to rectify the situation, state authorities proved inept in retrieving the misappropriated funds. This presentation analyzes this corruption case concerning the broader implications for the empire’s path toward modernization and the challenges faced in overcoming deep-rooted practices that hindered reforms. This scandal serves as a poignant illustration of the limitations inherent in the modernization reforms in the closing decades of the empire. Although political elites endeavored to propel their empire into a modernized state, instances of corruption such as this one underscored the persistence of old power structures and the systemic challenges within Ottoman state modernization. Based on official government documents, ministry archives, and contemporary newspaper articles and in dialogue with studies on the transformation of the Ottoman state by scholars, such as Carter Vaughn Findley and Kemal Karpat, this presentation identifies unique aspects of the collusion between Boyacıyan and Mehmed Ali Pasha and offers insights into corruption dynamics in the context of broader social and political transformation.