According to hedge fund Red Kite Management, it lost as much as $850 million on the copper market because its prime brokers at Barclays were a little loose-lipped with their proprietary trading colleagues, who allegedly used that information to bang the close and fuck over Red Kite.
Given the scale of the alleged losses, the fact that in spite of all of that Barclays still probably managed to lost almost as much as it allegedly cost Red Kite will be cold comfort. But, you know, it’s still a pretty amazing example of incompetence and buffoonery, even by Barclays’ high standards.
Two metals traders at Barclays were dismissed seven years ago after racking up losses of $396 million, according to documents disclosed in a court case…. The hedge fund claims that Macrae and Saunders used their knowledge of Red Kite’s positions to trade heavily against the fund. In court filings last week, Red Kite cited disclosures from Barclays that the fund said indicates that Macrae had sought to justify his position to risk officers by pointing to Red Kite’s opposing trade.
This is made all the more interesting given that Barclays—a publicly-traded company—pretended at the time that it never happened.
In 2011, Barclays denied reports that it had suffered significant losses in metals trading. "The reports of big losses are nonsense,” a spokeswoman for Barclays said at the time. “There has been no abnormal trading in the commodities business.”