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Transacted
September 8, 2026
Happy Tuesday. Today we’ve got a look at the latest case of fraud suffered by a Jefferies-managed fund…
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Third strike:
Jefferies Financial Group is back in the news after facing yet another headline-grabbing loss. A fund managed by the firm is alleging Singapore-based iron ore trader Radiant World duped Jefferies through a "fraudulent scheme" involving falsification of invoices, notices of assignment, and fabricated contracts.
The fund brought a claim of more than $500 million in London's High Court against Radiant World. First filed in late August, it was released publicly earlier today.
This is the third fraud-related loss event at Jefferies' asset management arm, following shortly after mishaps with auto parts supplier First Brands Group and property lender MFS.
LAM Trade Finance Group II LLC, the fund run by a unit known as Point Bonita within Jefferies' asset-management division, entered into credit agreements with Radiant World Corporation Pte and Sapphire Minmetals Corporation Ltd. under which it purchased iron ore receivables from both parties.
Those receivables then "ceased to be paid on a timely basis in late 2025 and in early 2026 began to go unpaid," says Jefferies. The fund then entered into a standstill agreement with both borrowers, which, says the filing, they subsequently "defaulted on."
"The Claimant infers that the receivables purportedly assigned to it and which have gone unpaid did not exist and/or were not validly assigned," the claim form says. It also states: "The claimant's investigations revealed that the fraud had been concealed from it for some time."
The defendants are the borrowing entities as well as founder and majority shareholder Pinkesh Nahar, and Rakesh Sethi, Sapphire's chairman and majority owner.
A UK court order on September 2nd confirmed that a worldwide freezing order had been put in place at a private hearing on August 27th, and granted the fund permission to apply for domestic freezing injunctions in Singapore and Hong Kong.
The Singapore application against Radiant World, Sapphire Minmetals and their majority owners is expected to be heard on Wednesday.
Bloomberg has also reported that trading counterparties previously told several Radiant World staffers that the invoices supporting their lending were either not genuine or had already been settled.
In July, several top commodity traders halted business with Radiant World over concerns it had falsified documents sent to banks as part of recent financing efforts. Radiant World denied wrongdoing and said it conducts its business to the highest commercial and legal standards.
Point Bonita was already in the process of winding down before the Radiant World situation as it managed the fallout from its $850 million exposure to First Brands and MFS.
Driving the decision: Jefferies' asset management business manages $32 billion and contributes less than 10 percent of group revenue, yet has been responsible for all three of the firm's recent credit blow-ups.
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