Credit Suisse warned about 'a suspicious invoice' from Sanjeev Gupta’s business empire, says report

AN independent, employee-owned commodities trading and logistics firm has warned Switzerland's Credit Suisse that the bank's supply chain finance funds appeared to contain a suspicious invoice from Sanjeev Gupta’s business empire, reported the Financial Times. 

In July 2020, Trafigura raised the alarm with Credit Suisse over a so-called receivable listed in one of the supply chain finance fund’s annual accounts.

According to the report, Trafigura owed money to Gupta’s Liberty Commodities, his main metals trading business founded nearly 30 years ago and part of his GFG Alliance group.

The Swiss bank’s own commodities trading finance division flagged its concerns over Gupta with compliance officers after discovering that its funds were investing in notes tied to his business, reported Bloomberg.

Switzerland's second largest bank has been under pressure from shareholder groups to clean up its act after being hit hard by bankruptcies at Archegos, a US hedge fund, and British financial firm Greensill.

The Credit Suisse fund accounts indicated that Liberty Commodities had raised financing against a $30 million invoice to Trafigura, one of the world’s largest commodities trading houses.

This meant that investors in the Credit Suisse funds should have earned a return when Trafigura paid the invoice. However, executives at the commodities trader told bankers at Credit Suisse that they did not believe this invoice was genuine, the newspaper report added.

The collapse of the $10 billion suite of Credit Suisse funds, which packaged invoices linked with Greensill Capital, the failed supply chain finance specialist, has angered clients of the Swiss bank, who invested billions into them.

Credit Suisse has warned that $1.2 billion of debt linked with Gupta may prove hard to recover, the report added.