A major trial over disputed metal deals is under way in the Commercial Court with Graham Dunning QC (assisted by David Davies and Stuart Cribb), instructed by Peter Bennett of Stephenson Harwood, representing Mercuria, one of the world’s biggest commodities traders. The dispute between the trading house and Citibank over apparently missing or multiple pledged metal in China which was subject to obligated repo transactions. The sum at stake is at least $270m. Faced with the prospect of large losses, banks and traders have been scrambling to limit their exposure to financing agreements after Chinese authorities in May started to investigate claims of fraud at warehouses in Qingdao and Penglai.
For further details see current press coverage:
- Citi v Mercuria, a.k.a. When Commodity Repos Go Wrong (Financial Times)
- Citigroup Panicked Over Fraud at Chinese Ports Mercuria (Bloomberg)