Trafigura is being sued over nickel fraud

Trafigura is being sued over nickel fraud

Trafigura Group, a global commodity trading company, is facing a lawsuit filed by the Reuben brothers, following a significant nickel fraud case that has affected global metal markets. The legal filings reveal additional details about the fraud, which involved the disappearance of thousands of tons of nickel and the use of counterfeit shipping documents. The Reuben brothers’ company, Hyphen Trading Ltd., alleges that the fraudulent activity extended to obtaining financing from ICBC Standard Bank Plc using these counterfeit documents. The filings also implicate a Singapore freight forwarding company in the alleged fraud. Additionally, Hyphen accuses Trafigura of obstructing its attempts to inspect the cargoes involved. Both Trafigura and the Reubens declined to comment on the matter.

David and Simon Reuben are some of the best-known figures in the history of commodity trading, having made their first fortune in the take-no-prisoners world of 1990s Russia. Now worth a combined $14 billion, they have not been major players in metals trading for decades, focusing instead on building one of the world’s biggest real estate portfolios. But they have continued to dabble in the sector through entities like Hyphen, which describes itself as a “commodities trader and financier” focused on refined metals.

The allegation that fraudulent shipping receipts – known as bills of lading – have been circulating in the nickel market will add to concerns among traders and financiers of the metal, which has been hit by a series of recent crises. The documents are central to modern commodity trading: original bills of lading represent legal ownership of a cargo of commodities and are often bought and sold numerous times, as well as being used as collateral for borrowing before the goods are finally delivered to an end user.

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