According to recent reports, commodities trader Mercuria Energy Group Ltd. An agreement was reached last summer to buy $36 million of copper from Turkish suppliers. But when the goods began to arrive in China, only containers full of painted rocks were found.
It is reported that according to the agreement reached with the Turkish supplier Bietsan last summer, Mercuria should have received a shipment of about 6000 tons of crude copper soon, but unexpectedly, the journey from the port near Istanbul to China had not even begun, and about 6000 tons of crude copper in more than 300 containers had been replaced with jagged paving stones, which were sprayed similar to semi-refined metal.
According to documents provided by Mercuria to Turkish investigators, a total of $36 million was paid to Bietsan in five installments during the carriage of the goods by sea, with the last payment on 20 August 2020. The fraud was not discovered until the ship began to arrive at Lianyungang, China, later that month. By this time, all eight ships had sailed for China.
Sinan Borovali, a lawyer for Mercuria in Turkey, said the copper was examined and sealed after it was initially loaded into the container, but the fraud gang took advantage of the night to open the container and quickly changed the bag, and then covered up its actions with fake seals.
"the buyer filed a petition for criminal investigation against the seller and two intermediaries," the Turkish police said in a statement. It has been determined that the incident was the result of organized fraud. " Usually in this case of non-delivery, the trading company could file a claim under the cargo insurance policy, but Mercuria found that only 1/7 of the contracts insured by Bietsan for the goods were genuine and the rest were forged.
The bizarre case highlights the vulnerability of commodity traders to fraud even when safety and inspection controls are in place. As part of the fraud investigation, in 2014 and 2015, Mercuria made preparations to make up for potential losses to make up for the confiscation of metals from warehouses in the port of Qingdao, China.
Turkish police have so far arrested 13 people in connection with the fake copper program. Mercuria, one of the world's five largest independent oil traders, is seeking compensation in Turkish courts and UK arbitration cases against copper supplier Bietsan. It also filed formal criminal proceedings with the Turkish police and prosecutors, accusing them of goods replacement and insurance fraud, and the authorities decided who was responsible.
