KEY POINTS
- Radiant World has laid off staff in Dubai as financing pressure grows.
- Singapore police are investigating reports concerning the commodities trader.
- Banks and brokers have frozen accounts or credit, while Radiant has sold aluminium inventory to raise cash.
Singapore-based iron-ore trader Radiant World has begun cutting staff as banks, brokers and other trading partners distance themselves from the company amid growing scrutiny over allegations involving invoicing and trade documentation.
The development highlights the mounting financial pressure on the commodities trader, whose business model depends heavily on access to bank credit and trading counterparties to finance large-scale commodity transactions.
Radiant World has laid off some operations and back-office employees at its Dubai office, according to people familiar with the matter. The exact number of workers affected was not immediately known.
The job cuts came earlier this month as negative reports surrounding alleged irregularities in the company’s iron-ore transactions began to affect its ability to conduct business.
Radiant has previously rejected the allegations, describing claims of wrongdoing as “inaccurate and unsubstantiated.”
The company employs more than 100 people across offices in Singapore, Dubai, Shanghai, London, Geneva, Connecticut and Mumbai, according to information published on its website.
A Radiant spokesperson declined to comment on the reported staff reductions.
Singapore Police Investigates Allegations
The pressure on Radiant has intensified following confirmation from the Singapore Police Force that it had received reports concerning the company.
Police said on Thursday that they were looking into the allegations, adding another layer of scrutiny to the challenges facing the trader.
The investigation follows reports questioning aspects of Radiant’s iron-ore trading activities, particularly allegations relating to invoicing and documentation.
The allegations have not been established as wrongdoing, and Radiant has maintained that the claims against it are inaccurate.
Radiant’s access to financing has also come under pressure.
Deutsche Bank and KBC Group NV have frozen some of the company’s Singapore bank accounts, while other financial institutions have reportedly suspended credit facilities, according to earlier reports.
Commodities broker Marex Group has also frozen all of Radiant World’s accounts, according to people familiar with the matter.
The withdrawal of banking and brokerage support could significantly constrain Radiant’s ability to finance commodity purchases and execute trades, particularly given the enormous volumes of iron ore it handles.
The banks and Marex have declined to comment on the specific actions involving Radiant.
