In a new article from FD, our very own Dr. Wouter Jacobs is quoted. The article concerns a big case of fraud at Trafigura. It seems that the containers of this commodity trading company do not always contain what they are meant to. Read more about it below.
Fraud at Trafigura
The commodity trading world is in an uproar. At Trafigura, a big case of fraud has been uncovered. More than a thousand sea containers were supposed to be filled with tons of nickel. However, it turned out that they contained a cheaper type of steal.
Dr. Wouter Jacobs said the following about the case: "Most of the smaller cases are settled or the loss is taken. Usually, this is cheaper than an expensive lawyer from London." He continued: "In the commodity trading world, Trafigura is known as a risktaker. On the other hand, they usually have their risk management straightened out because of that."
Wouter Jacobs also talked about the possible consequences: "The procedures will be refined and a possible effect could be that banks will be more cautious with financing commodity trading. Eventually, this means higher interest rates and costs." As a final note, he added: "Commodity traders fulfill an essential role. A lot of money is made, but also a lot of risk is taken. Meanwhile, they are the ones that make sure that the commodities are delivered. Trafigura is now supplying Germany with liquid gas after Russia fell through as a supplier."
Interested to know more? Read the full article here.