Photographer: Wei Leng Tay/Bloomberg
When Credit Agricole SA and HSBC Holdings Plc issued a payment guarantee for a US$76.5 million fuel purchase from a Singapore trader in March, they unwittingly became the latest victims in a series of trade finance scandals that have led to more than $9 billion in potential losses for global lenders.
At the same time that Hin Leong Trading Pte. was pledging the fuel to back the loan, it allegedly agreed to sell the same cargo to another trader, who sought letters of credit from three banks including Credit Agricole.
This line of credit merry-go-round was among many allegedly fraudulent tools used by Hin Leong, one of Singapore's biggest oil traders before its spectacular collapse in April that left 23 banks on the hook for $3.5 billion, according to a report from court-appointed managers.
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