Trafigura Pays $55 Million to Settle US Fraud, Manipulation Charges

By Trisha Andrada

Jun 18, 2024 03:06 AM EDT

The name and logo of the multinational commodity trading company Trafigura is pictured in the company's offices entrance in Geneva, on November 24, 2020.
(Photo : FABRICE COFFRINI/AFP via Getty Images)

Trading giant Trafigura has agreed to pay a $55 million fine to settle allegations of fraud and manipulation with the United States authorities.

Illicit Activities Between 2014 and 2020

According to the Financial Times, the Commodity Futures Trading Commission (CFTC) charged the corporation with offenses that occurred between 2014 and 2020.

The current CFTC complaint asserts the business fraudulently got non-public gasoline market information from a Mexican trading organization employee and conducted trades with it. Trafigura is also accused of manipulating the benchmark price of fuel oil in 2017 to benefit its futures and swap holdings.

Moreover, the CFTC charged the company with pressuring workers to sign non-disclosure agreements without a law enforcement carve out, which hindered investigations.

Ian McGinley, the head of enforcement at the CFTC, said that the legal action is further proof of the agency's determination to prevent trading abuses that damage the integrity of the derivatives markets.

While Trafigura did not directly address the accusations, it did state that it has deliberately improved its compliance procedures significantly since the time in issue.

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String of Investigations

The CFTC penalties are the latest in a series of probes against the world's largest trading business.

Following its March guilty plea to US bribery allegations in Brazil, as reported by Bloomberg, Trafigura agreed to pay penalties totaling $127 million and relinquish any profits earned. Prosecutors alleged the corporation earned $61 million from bribery to keep business with state-owned oil group Petrobras.

Meanwhile, bribery allegations in Angola are set to be heard in a trial in Switzerland involving Trafigura and its former chief operating officer, Mike Wainwright.

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