Auto close of issues not working if squashed

Summary

When you have squashed your commit messages, and then create another merge request, the issues that were referenced don't get closed.

Steps to reproduce

Example: 2 branches: master, testing, dev

Merge request dev -> testing with squash

Merge testing -> master with squash

Any issues referenced in dev don't get automatically closed

Example Project

https://gitlab.com/InZernetTechnologies/ICC

What is the current bug behavior?

Issues referenced don't get closed

What is the expected correct behavior?

Issues referenced get closed