Copper scandal case settled

ONE of the great 'rogue trader' cases in financial history came to an end in the High Court today after giant Japanese conglomerate Sumitomo settled its claim against London copper broker Credit Lyonnais Rouse.

Settlement of the case over the 1990s copper market fixing scandal in which Sumitomo lost $2.6bn at the hands of its disgraced trader Yasuo Hamanaka, also takes the spotlight off CLR boss Roy Leighton, who has just been appointed to a key position at the Financial Services Authority, the City's top watchdog.

Having previously recouped $400m in settlements from US trading houses Merrill Lynch and JP Morgan, Sumitomo this month embarked on its last major Hamanaka-related case, with a $1.1bn (£600m) action against CLR with whom Hamanaka did business.

However, after only five days in court, both sides announced today that they had reached a secret settlement over the weekend.

They said in a joint statement: 'Without any admission of wrongdoing, CLR has agreed to pay a contribution to Sumitomo's costs. Sumitomo has expressly and unreservedly withdrawn all allegations of dishonesty against CLR and its employees past or present.'

Neither side would comment on the amount CLR has paid, although it is thought CLR's settlement does not go further than making a payment to cover Sumitomo's legal bill.

It is believed Sumitomo had budgeted £25m to cover the bill of its lawyers, Ashurst, for what was originally scheduled to be a 30-week case and for which it had hired £1m-a-year QC Christopher Carr. CLR's costs are reckoned to be vast after hiring Clifford Chance to mount its defence.

Before the case was settled, the court heard that Leighton and fellow CLR bosses were paid £4m bonuses after the broker and another City firm, Winchester - headed by Charlie 'Copperfingers' Vincent and Ashley Levett - made about $100m profit from trading with Hamanaka.

Leighton, a senior executive at CLR parent Credit Agricole, was this week appointed deputy chairman of one of the FSA's most important regulatory arms, the Financial Services Practitioners' Panel, regarded as a bridge between the FSA and the firms it oversees.