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Steel Executives Face Penalties for $500 Million Trade Financing Scam

Steel Executives Face Penalties for $500 Million Trade Financing Scam

Three British business executives were incarcerated on Tuesday for carrying out a major $500 million trade finance fraud. Nasser Alaghband, CEO of Balli Steel Plc, plead guilty and was sentenced for six-and-a-half years in prison. Melis Erda, the Managing Director, along with Louise Worsell, the Treasurer, both were convicted by the jury on numerous counts of fraud and were each handed more than three years in prison and an additional six year restriction from being a company director.

The Serious Fraud Office (SFO) of the UK accused these three individuals of putting in place the plan to cheat a number of trade finance banks, including Cooperatieve Rabobank UA, through the provision of spurious shipping memos and forged signatures regarding phony sales contracts.

Balli Steel is into the international trading of steel goods and are funded by short-term loans. An investigation was sparked off because of the company’s collapse in 2013 and the debt of around $500 million they owed to more than 20 different banks. The Director of the UK SFO, Lisa Osofsky, applauded the continuous efforts of the investigators and expressed her disapproval over the fraudulent activities of the trio in the statement: “Using a Cayman Islands address, a fax machine, and a stream of blatant lies, these three individuals plied their criminal trade to defraud banks out of half a billion dollars”

The Balli Group Plc is a multinational business headquartered in London that operates through a large number of subsidiaries in more than 33 countries, spanning across Europe, Africa, and the Americas. The primary focus is to provide engineering products and services in the steel and non-ferrous activity areas. It was established in 2003 by a group of leading global industrial investors, and is currently led by Nasser Alaghband who was appointed Chief Executive Officer in 2008.

The trial of Nasser Alaghband, Melis Erda, and Louise Worsell has shown that the rule of law applies across the board regardless of class or position. Taking advantage of their respective positions of power they were able to successfully scam a large amount of money, but by being caught and prosecuted they were assigned the responsibility of paying back what they owed and receiving their just punishment. Hopefully, this serves as a lesson to others who may think of carrying out these malicious activities.