How Citigroup helped lift the lid on Trafigura’s nickel nightmare – by Jack Farchy and Jonathan Browning (Bloomberg News – February 14, 2023)

As Trafigura Group’s metal traders were partying in London at last year’s LME Week jamboree, Citigroup Inc. was taking a step that would end up shaking their world.

Until late October, the US bank had been helping to finance Trafigura’s nickel trades with companies linked to Indian businessman Prateek Gupta — deals which Trafigura now says were part of a “systematic fraud” against it that could cost more than half a billion dollars.

On Oct. 27, Citi pulled the plug on financing any more of the deals. That set off a cascade of events: Trafigura inspectors went off to check containers that were supposed to hold nickel, only to find they didn’t.

At an early January meeting in London, Gupta confirmed the scale of Trafigura’s exposure and offered to settle the amount over time. But the company decided instead to go to court. Last week, it won a $625 million freezing order in a UK court against Gupta and his companies.

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