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US regulator subpoenas metals warehousing companies

(Credit: Reuters) This Reuters photo shows traders and clerks reacting on the floor of the London Metal Exchange in the City of London. London Metal Exchange
August 17
4:51 AM 2013

The US Commodity Futures Trading Commission (CFTC) has issued a subpoena to major metals warehousing companies. This came after companies that use metals like the Coca-Cola Co made allegations that warehousing firms restricted the flow of basic materials. As a result, metal had become more costly to purchase. Before the subpoena, the US regulator had ordered the warehouses in a letter to keep all documents, instant messages and emails they had from the past three years intact. The subpoenas were an indication that the CFTC is bolstering into its inquiry of the complaints.

Sources told Reuters that Swiss-based Glencore and its metals warehousing subsidiary, Pacorini, got the subpoena. Another source also said that another company was also subpoenaed but asked Reuters to withhold the name of the company. This source further said that the enforcement division of the CFTC had asked the firm to deliver all communication related to the London Metal Exchange (LME) to them by August 23. The CFTC asked that all correspondence, including emails, documents, voice recordings and communications from January 2010 should be turned over.

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