Trafigura $600m Fraud Trial Centres on Nickel Cargoes

Geneva-based Trafigura is suing businessman Prateek Gupta for running a "Ponzi scheme" and "systematic fraud" alleging he substituted $600m of nickel cargos (meant to be 99.8% pure) with low-value carbon steel. 

Gupta has admitted to supplying fake cargoes but counterclaims that the scheme was orchestrated by Trafigura themselves, to elevate their standing in the nickel market but giving an impression of high trading volume. 

Complaints around the cargos started coming in around November 2022. Nathan Pillow, lawyer for Trafigura, was quoted as saying the company had "paid for rubbish".

Citi was also involved in the financing of these deals.

The scheme was apparently disrupted when Citi, spooked by rising nickel prices, demanded return of physical nickel cargoes.

Trafigura ex-COO on trial for corruption

The case, being heard by the Swiss Federal Criminal Court, exposes how Trafigura used third parties to channel bribes including the alleged bribery of an Angolan official between 2009 and 2011. The former executive on trial is Mike Wainwright. This is the first case where executive leadership of a major commodities trading house has been on trial despite being in the sights of prosecutors for years.