Justice Department and CFTC probe Radiant World’s iron ore trading activities

Radiant World, a Singapore-based firm that had quietly become a major force in the global iron ore market, is now facing investigations from two of the most powerful enforcement bodies in the United States. The Department of Justice and the Commodity Futures Trading Commission are both examining the company’s trading activities, with allegations centering on falsified or invalid documentation submitted to banks. The probe is still in its early stages, but the fallout has already been swift and significant. Some of the biggest names in commodity trading have stepped back from doing business with Radiant World entirely. What Radiant World is accused of At the core of the investigation is a straightforward but serious allegation: that Radiant World submitted fraudulent invoices and other documentation to financial institutions in connection with its trading operations. In commodity finance, documentation is everything. Banks extend credit based on the validity of trade documents, so fabricated paperwork is not a minor bookkeeping error, it is a mechanism for obtaining financing under false pretenses. Rabobank conducted an internal review of Radiant World’s documentation practices seve...