The Strategist

Trafigura loses $577M in fraudulent nickel swap

02/10/2023 - 02:14

One of the biggest merchants in the world, Trafigura, purchased nickel from Indian businesses. Containers of regular steel arrived at the port of destination instead of nickel. According to the trader's assessment of the losses, the corporation was cheated of $577 million in a conspiracy to swap nickel unlawfully.

Trafigura Images
Trafigura Images
One of the biggest raw material merchants in the world, Trafigura Group, said that fraudulent counterfeit nickel shipments have cost it $577 million in losses since the year 2023. Due to the fraud, the corporation suffered a record loss; however, Bloomberg adds that if some of the money can be retrieved, the loss may be lessened.

According to Bloomberg’s sources, Socrates Economou, head of the nickel and cobalt trading business, will leave the organization; however, Trafigura stated that it does not believe any employees were involved in the fraud. Economou joined the company in 2007, and in 2016 he was named head of trade for nickel and cobalt. He was a senior metal trader at Trafigura.

In January and February, the business discovered what it considered to be "systematic fraud," and in response, it filed a lawsuit against Indian businessman Prateek Gupta and a number of connected entities, including TMT Metals and UD Trading Group subsidiaries. The incident with the trader was described by the agency as "another dark mark for the metals trading business."