Radiant World Sues Glencore for Over $2 Billion in Singapore, Alleging Fraud

Iron ore trader Radiant World Corp. and affiliated companies have filed a lawsuit against commodities giant Glencore PLC in Singapore, seeking more than $2 billion in damages. The suit, filed in Singapore's High Court on Tuesday, alleges fraud, breach of contract, and conspiracy.

Details of the Allegations

According to the court filing, Radiant World claims Glencore deliberately concealed their trading arrangements from its audited records. This allegedly occurred while Glencore was under compliance monitoring by the U.S. Justice Department following its 2022 guilty pleas to charges of bribery and commodity price manipulation.

The central dispute stems from a 2021 incident where Glencore demanded Radiant World pay a $1.1 billion mark-to-market exposure on derivatives positions. The lawsuit contends that the long-standing practice between the firms had been to roll over such losses. Radiant World further alleges that Glencore extracted over $800 million in payments between 2021 and 2026 under the pretense of a long-term partnership before abruptly terminating the relationship this year.

Glencore's Response and Market Position

Glencore has forcefully rejected the accusations. "These claims are meritless and we will contest them vigorously," the company said in a statement on Tuesday. "We have incurred losses and been exposed to risks by Radiant World companies and will take appropriate action."

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For investors, the dispute may not be a complete surprise. Glencore disclosed in early August that it had booked a provision related to its exposure to Radiant World. On Friday, the London-listed company confirmed it had "stopped all business and exited all obligations" with the iron ore trader.

Broader Context

The lawsuit comes as Radiant World faces its own significant business challenges. Last month, Singapore’s police force confirmed it had opened an investigation into the company after receiving unspecified reports. Financial institutions and counterparties have reportedly been distancing themselves from Radiant World over concerns that invoices it provided to its banks may not have been valid.

Radiant World has denied any wrongdoing in relation to these separate matters, describing the claims against it as inaccurate and unsubstantiated. The company's lawsuit also alleges that Glencore made damaging statements about it to financial institutions and media outlets.