Representatives of Trafigura, a major international trader, made a number of important mistakes in making a deal with companies connected with Indian businessman Practical Gupta. As a result of the shortfalls, the company lost $577 million due to nickel substitution, informs The Financial Times cites court documents.
The company announced its intention to sue in connection with the fraud in early February this year. The deal with Indian companies for 1,104 containers of high-grade nickel was completed last year. However, in fulfilling the deal, the counterparties actually “established” the trader by shipping cargo to Trafigura with the product substitute – much cheaper carbon steel was found in the containers instead of the required nickel.
In signing an agreement with their Indian counterparts, Trafigura representatives in particular overlooked the so-called “danger signs” that needed closer attention. According to the FT, this includes, among other things, the absence of a requirement for certification of cargo analysis at shipment and ignoring incorrect customs codes.
In the story, “Trafigura didn’t need certificates of analysis, ignored incorrect customs codes, and missed other red flags that alarmed bankers about nickel shipments that later turned out to be counterfeit.”
August 27 Bloomberg, citing the source reportedmajor international trader Trafigura helps sell Russian diesel fuel to Ecuador. It was about the Marlin Aventurine delivering 262,000 barrels of fuel to Petroecuador, Ecuador’s state oil company.