Glencore PLC's warehouse unit Access World Logistics (Singapore) Pte Ltd. was largely to blame for US$32 million in losses from a complex metals fraud, wherein it failed to quickly identify fake receipts for nickel stored at Asian warehouses, Reuters reported Oct. 2 citing a London High Court ruling.
However, broker Marex Spectron International Ltd. would have to pay most of the charges to French bank Natixis, which sued the broker for the fraudulent receipts that were part of a repurchase agreement, according to the report.
Marex Spectron brokered the deal between Natixis and a Hong Kong firm. None of the concerned parties disputed that the receipts were counterfeited, but it was unclear which party committed the forgery.
Under Access World's terms and conditions, its liability was limited to €100,000 per warehouse receipt. Further, London High Court Judge Simon Bryan slashed Marex Spectron's recovery by 25% due to its own negligence.
The judgment did not specify the total amount recoverable, but according to Reuters calculations, Marex Spectron stands to recover up to €1.2 million from Access World over 16 warehouse receipts.
In the wake of the investigation that uncovered the fraudulent transaction receipts, Access World enacted additional features and procedures, including new technology.
