Olam pays $3m to settle unlawful cocoa trading case
The Commodity Futures Trading Commission (CFTC) imposed the penalty after it alleged that Olam had freely shared information between its US and international cocoa businesses, but had not consolidated its reporting.
This practice was found to violate cocoa position limits and CFTC said the company was consequently complicit in unlawfully executing non-competitive trades.
‘Without admitting or denying the allegations’
“Olam has agreed to pay a fine of $3.0 million without admitting or denying the allegations of the complaint.” said the company in a statement.
The firm said that it had fully cooperated with the Commodity Futures Trading Commission’s investigation.
Olam recently acquired ADM Cocoa’s grinding operations to become the world’s third largest cocoa processor behind Barry Callebaut and Cargill.
Stephan Ariyan, Olam’s chief compliance counsel, said: “As far as Olam is concerned this matter is now settled and we wish to emphasise that there has been no impact on our clients or the market.”
The CFTC alleged that between February 2011 and January 2013 the cocoa futures positions of Olam International and Olam Americas were not independently controlled. It said that the accounts of both businesses should have been aggregated since traders in each business bought and sold cocoa futures for one another.
