Core Insights - Trafigura Group faced significant financial losses, approximately $600 million, due to questionable nickel-financing deals with firms run by Prateek Gupta, which have been described as resembling a Ponzi scheme [1][4] - Concerns regarding the relationship with Gupta were raised as early as September 2020, indicating that senior management was aware of potential risks long before the eventual collapse of the trading arrangement [2][3][5] Group 1: Financial Impact and Allegations - The trading house revealed in early 2023 that it had been defrauded, discovering that over $500 million worth of metal it purchased contained no nickel but rather stainless steel, aluminum, and worthless iron briquettes [4] - By 2021, the business dealings with Gupta had escalated to nearly 70,000 tons, equating to $1.2 billion in annual trading, despite earlier warnings from the trade finance department [5] - Gupta's firms engaged in "transit financing," where cargoes were sold and then bought back at a premium, raising questions about the legitimacy of the transactions [6] Group 2: Internal Concerns and Management Awareness - Emails from Trafigura's trade finance desk highlighted alarm over the business strategy with Gupta, noting long voyage times, high interest costs, and irregular sales, which led to concerns from major banks like Credit Suisse and Deutsche Bank about processing payments to Gupta's companies [8] - Senior figures within Trafigura, including the co-heads of metals, expressed disapproval of the dealings with Gupta, indicating a mixed reception among the company's leadership [9]