Date
20 October 2017
Noble, Asia's largest commodity trader by sales, is being accused of exploiting the accounting treatment of its associates to avoid large impairments and fabricate profit. Photo: Noble Group
Noble, Asia's largest commodity trader by sales, is being accused of exploiting the accounting treatment of its associates to avoid large impairments and fabricate profit. Photo: Noble Group

Noble rejects bogus profit claims by shadowy group

Noble Group is vigorously defending itself against allegations by a shadowy research group that it has been fabricating profits.

Asia’s biggest commodity trader by sales said it “completely rejects” the allegations, according to the Financial Times.

Singapore-listed Noble shares tanked as much as 10 per cent on Monday after a group calling itself Iceberg Research made the claims in a 17-page report.

Iceberg accused Hong Kong-headquartered Noble of exploiting the accounting treatment of its associates “to avoid large impairments and fabricate profit”.

“The company completely rejects the allegations. All material information to which Iceberg Research refers is in the public domain,” Noble said in a statement to the Singapore exchange.

“There has been no material adverse change since the company last reported.”

Noble added said it “reserves its rights against Iceberg Research”.

Iceberg Research posted the report on Twitter on Monday, adding later: “We confirm that at this point we have no short interest in Noble Group [directly or indirectly].”

When contacted by the Financial Times, Iceberg Research said it wished to maintain its anonymity but added it might “give more information on us later on but we would like people to focus on the strength of the arguments for the moment.

“To make it very clear, we do not make any money from this [at any level]. If this changes, we will advise the market.”

It was the second time in three years that a Singapore-listed commodities company has come under attack from a research group.

In late 2012 Olam, a cashews-to-coffee group, came under fire over accounting practices and ballooning debt from Muddy Waters, a US-based shortseller.

In Olam’s case, the knock to shares proved brief. The company rejected the criticism, and conducted a capital raising exercise that helped push shares higher.

Olam, Noble and a third Singapore-listed commodities group, Wilmar, are widely considered to be Asia’s rivals to longer-established western businesses Cargill, Archer Daniels Midland and Bunge.

Noble mines, ships and finances supplies of iron ore, coal and agricultural commodities including grains, sugar, palm oil and coffee.

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