Glencore Plc has accused iron ore trader Radiant World and its associated companies, including Sapphire Minmetals, of sending falsified invoices, contracts, and fabricated emails to multiple financial institutions, fraudulently claiming these documents originated from Glencore personnel. This accusation follows Glencore's announcement on September 15 that it had ceased all business dealings and exited all obligations with Radiant World and its affiliates, citing confirmed evidence of fraud.
In response to Glencore's allegations and withdrawal, Radiant World and Sapphire Minmetals have filed a lawsuit against Glencore Plc in Singapore, seeking $2 billion in damages. Rakesh Sethi, chairman of Sapphire Minmetals, confirmed the filing to Bloomberg News, stating that the two companies were collaborating on the claim. Glencore has dismissed these claims as meritless and intends to vigorously contest them, adding that it has suffered losses and been exposed to risks due to Radiant World's actions and will pursue appropriate countermeasures.
The dispute marks the end of what was once a very close business relationship, with Glencore having been a significant backer of Radiant World for years. Previously, Glencore had reportedly helped secure financing for Radiant World and held warrants to potentially acquire a minority stake. However, the relationship deteriorated earlier this year after banks approached Glencore with unverified invoices bearing its name that were allegedly provided by Radiant World. Glencore has taken a $480 million provision related to its exposure to Radiant World, one of its largest trading losses as a public company, though it states its current exposure is below its $500 million materiality threshold.
Prior to Glencore's direct fraud accusations, other entities had also raised concerns. Incomlend, a Singaporean invoice financing platform, alleged that Radiant World used non-genuine Glencore documents to secure loans. Additionally, Jefferies Financial Group accused Radiant World of falsifying iron ore invoices as part of a "fraudulent scheme," leading to a $499 million worldwide freezing order against Radiant World and Sapphire Minmetals. Glencore is currently conducting a review of its historical business activities with Radiant World, Sapphire Minmetals, and associated companies.
