Jefferies-backed Fund Sues Radiant World Alleging $500M Fraud and $10,000 in Cash
Allegations and Legal Proceedings Surrounding Radiant World
Background of the Case
LONDON, Sept 17 (Reuters) - The iron ore trader Radiant World may hold only $10,000 in cash, even though its most recent financial statements refer to cash balances of more than $200 million, lawyers for a Jefferies-linked fund suing Radiant over an alleged fraud said on Thursday.
LAM Trade Finance Group II, in which US bank Jefferies holds a minority stake, obtained a freezing order last month from London's High Court against Radiant World and its founder Pinkesh Nahar as well as Sapphire Minmetals, which used to be part of the company.
Investigations and Responses
Singapore's police force last month said it was investigating Radiant World after reports that invoices provided to its banks may not have been valid.
Radiant World, which has denied the allegations, did not reply to a request for comment on Thursday. Sapphire Minmetals did not respond to a request for comment.
Details of the Alleged Fraud
Nature of Receivables and Transactions
LAM Trade Finance Group II, which has also obtained freezing orders in Hong Kong and Singapore, says it purchased iron ore receivables from companies linked to Radiant and/or Sapphire, by which it bought the right to be paid by traders such as Glencore and Vitol.
But those receivables either did not exist or were not validly assigned, it said in its claim against Radiant World.
Judicial Commentary
"It appears that the defendants used debit notes to paper over the cracks, as it is put by the claimant, for as long as they could and it is characterised that 'the well has now run dry'," Judge Simon Bryan said when he made the freezing order.
Explanation of Receivables
In trading, receivables are amounts of money that a company is owed by its customers for goods that have already been delivered but not yet paid for.
Defendants’ Position and Court Proceedings
Statements from Pinkesh Nahar
Nahar said in a document submitted by his lawyers for Thursday's hearing that it was not clear precisely what role he was alleged to have played.
Nahar has indicated his intention to challenge the court's jurisdiction, said the document, which described the case as "a substantial, complex, $500 million international fraud claim".
Arguments for Maintaining the Freezing Order
At Thursday's hearing, lawyers representing LAM Trade Finance Group II argued in court documents that the freezing order should remain in place because of the risk that the defendants would dissipate assets.
They said asset totals provided in a witness statement on behalf of Radiant World were "substantially different" from those in financial statements for the year to September 30, 2025.
"The audited financial statements refer to cash balances of over $200 million whereas (the statement) says that Radiant World holds only $10,000 in cash," they said.
Other Legal Actions and Future Hearings
Radiant World is embroiled in other lawsuits. It has sued Glencore in Singapore seeking more than $2 billion.
Judge Andrew Henshaw said on Thursday that the next London hearing was likely to take place in late December.
Reporting Credits
(Reporting by Polina Devitt; Writing by Sam Tobin; Editing by Louise Heavens and Alexander Smith)
