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Citi halted financing for Trafigura’s nickel deals in October – Bloomberg
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(Reuters) -Citigroup Inc stopped financing nickel deals for commodity trader Trafigura with companies linked to Indian
(Reuters) -Citigroup Inc stopped financing nickel deals for commodity trader Trafigura with companies linked to Indian businessman Prateek Gupta on Oct. 27, Bloomberg News reported, citing a court filing.
Trafigura last week said it booked a $577 million charge in the first half of 2023 after discovering that some nickel cargoes it received did not contain the metal in a case of “systematic fraud”.
Citi’s move had prompted the commodity trader to send inspectors to check containers that were supposed to ship the metal, Bloomberg News reported late on Monday, adding that it was not clear what led the U.S. bank to pull financing.
Trafigura has said the fraud was committed by a group of companies connected to and controlled by Gupta, including TMT Metals and companies owned by Gupta’s UD Trading Group.
Trafigura had already sold about $100 million of such cargoes, the report said.
Trafigura and Citi declined to comment. UD Trading Group did not immediately respond to a request for comment.
(Reporting by Arundhati Sarkar in Bengaluru; Editing by Kirsten Donovan)
Systematic fraud refers to a deliberate and organized scheme to deceive individuals or organizations for financial gain, often involving multiple parties and a structured approach to conceal the fraudulent activities.
A commodity trader is an individual or entity that buys and sells raw materials or primary agricultural products, such as metals, oil, and grains, typically through exchanges or over-the-counter markets.
Financing refers to the process of providing funds for business activities, making purchases, or investing. It can involve loans, credit, or other financial instruments to support operational needs.
A court filing is the formal submission of documents to a court, which may include complaints, motions, or other legal documents required to initiate or respond to legal proceedings.
In financial terms, a charge refers to an expense or cost that is incurred, often related to a transaction or service, which can impact the financial statements of a business.
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