Fake receipts at Glencore warehouse unit triggered sector credit freeze, Qingdao shivers: sources

Mon Feb 13, 2017 4:30am EST
 
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By Melanie Burton

MELBOURNE (Reuters) - Some global banks briefly froze credit lines for Singapore metal traders last month after a unit of commodities giant Glencore uncovered fake warehousing receipts, people familiar with the matter said, reviving the specter of a $3 billion scandal that rocked the trading world three years ago.

Though the impact has proved limited so far, the "forged" receipts for nickel stocks that Glencore's Access World unit said it found still set alarm bells ringing - even though regulation and scrutiny have been tightened across the business since the 2014 Qingdao port scandal in China.

Two people who have metal storage dealings with Access World said the company told them the receipts were from a third party, not issued internally. At Qingdao, a firm allegedly duplicated notes pledging metal as collateral for multiple bank loans.

"We checked with (Access World) and all our stock was in good order," said one of the people, an official at a Singapore trading house. But the firm did have its credit lines temporarily frozen by several banks while they investigated, the person said, speaking on condition of anonymity.

Metals traders told Reuters that a raft of international banks involved in providing finance to the sector, including Australia's ANZ, France's Natixis and Rabobank of the Netherlands, temporarily froze some credit lines before for the most part resuming business.

Natixis declined to comment. Rabobank said it was aware of the news on forged warehouse certificates circulating in the name of Access World, and was "assessing the situation," but could not comment further.

ANZ said that its "warehouse commodity financing was a small business within (the bank's) institutional division with only a handful of customers", and declined to comment further.

In its statement disclosing the incident, Access World said it had become aware of "forged warehouse receipts" and urged holders of its warehouse receipts to authenticate them. Last week it said it would provide authentication for clients' certificates on Feb. 10-15, after which it would honor "duly authenticated original warehouse receipts".   Continued...

 
FILE PHOTO -  The logo of commodities trader Glencore is pictured in front of the company's headquarters in Baar, Switzerland, September 30, 2015.  REUTERS/Arnd Wiegmann/File Photo