Olam pays $3m to settle unlawful cocoa trading case

By Oliver Nieburg contact

- Last updated on GMT

The Commodity Futures Trading Commission said Olam shared trading information between its US and International businesses, but failed to consolidate its reporting. Photo credit: cstrom
The Commodity Futures Trading Commission said Olam shared trading information between its US and International businesses, but failed to consolidate its reporting. Photo credit: cstrom

Related tags: Commodity market, Futures contract, Adm cocoa

The world’s third largest cocoa processor Olam has agreed to pay a fine of $3m for alleged mistrading of cocoa futures but has refused to admit wrongdoing.

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.

Related news

Related products

show more

Fonterra Keeps Your Ingredients Ahead of the Curve

Fonterra Keeps Your Ingredients Ahead of the Curve

Fonterra | 26-Jul-2022 | Technical / White Paper

With health and environmental concerns in mind, consumers’ commitment to purchasing organic products continues to grow. Whether your brand is starting...

Functional Benefits in Sports Nutrition

Functional Benefits in Sports Nutrition

ADM | Recorded the 12-May-2022 | Webinar

Sports nutrition is not just for high-level athletes anymore, but for a broader set of active consumers who are seeking nutrition for both physical and...

Follow us

Products

View more

Webinars