Trafigura attorneys accused Prateek Gupta of getting had a historical past of fraudulent dealings earlier than he allegedly organized a $600 million metals rip-off with the commodity group, because the Indian businessman gave proof for the primary time on Wednesday.
Gupta acknowledged he was being investigated for fraud in India, however denied the allegations as he took the stand in a trial in London’s Excessive Courtroom.
Switzerland-based Trafigura sued Gupta over two years in the past, alleging he was the mastermind of a rip-off by which he and his corporations agreed to offer pure nickel however delivered metal or scrap as a substitute.
Learn extra: Businessman Accused in Trafigura Nickel Nightmare Goes on Trial
Trafigura lawyer Nathan Pillow cited two different fraud instances involving Gupta’s corporations by which nickel was substituted for low-value metals, however Gupta mentioned he was not conscious that was happening.
“The truth is that dealing in fraudulent payments of lading is an experience of yours,” Pillow instructed Gupta, who was testifying remotely from Dubai the place he lives.
Gupta is beneath investigation for financial institution fraud in India in reference to Indian firm Ushdev Worldwide Ltd, a part of Gupta’s UD Group, he acknowledged.
Trafigura’s first metals trades with Gupta in 2014 have been with Ushdev, which later had monetary difficulties, was declared bankrupt in 2018 and is presently being managed by insolvency professionals.
Gupta has countered that workers at Trafigura devised a secret scheme, saying he was requested in 2019 to sharply enhance nickel buying and selling beneath then head nickel dealer Sokratis Oikonomou.
“Oikonomou was aggressive in his buying and selling strategy and outlook and… wished to broaden Trafigura’s nickel buying and selling operation to a place of dominance available in the market,” Gupta mentioned in a courtroom doc.
Oikonomou has strongly denied he was concerned within the fraud and mentioned the elevated buying and selling volumes with Gupta have been modest in comparison with Trafigura’s general nickel operations. Trafigura terminated Oikonomou’s employment in January 2023.
In line with Gupta, India-based Trafigura dealer Harshdeep Bhatia mentioned Trafigura aimed to ramp up commerce to 50,000 metric tons of nickel a 12 months, about triple the amount beforehand.
Bhatia, who not works for Trafigura, didn’t reply to an emailed request for remark.
That giant amount of pure nickel, price about $625 million on the time, could be troublesome to supply and likewise show problematic when it comes to credit score insurance coverage limits, Gupta mentioned.
To get round these points, Oikonomou proposed increasing the scope of buying and selling to different metals at a gathering in Dubai in June 2019, Gupta mentioned.
The true identification of these metals, together with nickel alloy and scrap, must be stored secret as a result of Trafigura’s financing financial institution Citi would solely present funds for pure nickel, Gupta mentioned.
Citi has declined to touch upon the fraud case.
(Reporting by Eric Onstad; modifying by Jan Harvey)
{Photograph}: Generated by AI, AdobeStock
