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Trafigura claims Gupta stole money from metals fraud to fund his distressed companies

Lawyers for commodity trader Trafigura accused Indian businessman Prateek gupta of siphoning funds from an alleged metals fraud worth $600 million to prop up their struggling business empire.

Trafigura, a Geneva-based company, sued Gupta more than two years ago. It claimed that he was behind a scam where he and his firms agreed to deliver pure nickel but instead delivered scrap steel or other metals.

Gupta claims that Trafigura employees designed the scheme at the heart of the case. Trafigura, however, has denied this claim repeatedly.

Gupta admitted on the second day of his testimony in the long-running trial at a London High Court that the UG Group was going to run out of money by March 2021. This is partly because of problems related to the COVID-19 Pandemic.

Nathan Pillow, a Trafigura lawyer, also confirmed that his company was paid $500 million for pure Nickel but sent containers of lower-value metals.

Gupta responded that a portion of the profit went towards increased shipping costs when Pillow asked.

Where is the money?" "Did you steal it?" Pillow asked Gupta.

The Trafigura fraud scheme was crucial to your survival.

Gupta testified via video link from Dubai, where he resides: "I wasn't running the cashflow".

Gupta repeatedly stated during his testimony, that he was not aware of operational details. Others were to blame.

Gupta stated in a court filing that the trading with Trafigura for shipments labeled as nickel totaled 22,500 metric tonnes from October 2017 through May 2019. This will jump to 57.222 tons in 2020, and to 69.165 tons in 2021.

Trafigura's lawyers claimed that Gupta had been involved in fraudulent transactions before the alleged Trafigura fraud.

Gupta admitted that he was under investigation in India for fraud, but denied all allegations.

His defence is based on his accusation that Trafigura staff devised a secret plan to replace metals in order to boost Trafigura’s position in the nickel markets.

He claims that the undercover plan was devised in 2019, when he was told to boost nickel trading by Sokratis ikonomou, then the head nickel trader.

Oikonomou denied being involved in fraud during testimony this week. (Reporting and editing by Emelia Sithole Matarise; Eric Onstad)

(source: Reuters)