Alleged Dynamic Oil Trading Fraud was "Untimely Lack of Care" and Not Illegal Activity, Says Lawyer

Lawyer Arvid Andersen says no illegal activity has taken place, but OW Bunker says it has reported 2 DOT employees to the police over the matter

Allegations of a $125 million fraud at Dynamic Oil Trading are untrue, according to a lawyer representing the head of the Singapore-based OW Bunker subsidiary.

Arvid Andersen, who represents Lars Møller, CEO, Dynamic Oil Trading, told Reuters it was a case of "untimely lack of care" and the question is not if illegal activity has taken place, but whether internal guidelines have been broken.

"The case is not that somebody has stolen money, billed fictitious trades or given kickbacks. The case is that a big credit given to one customer was built up," Andersen said.

The case first came to light last week when OW Bunker announced it had been "informed about a fraud committed by senior employees in the Singapore-based subsidiary Dynamic Oil Trading" and in the same announcement, said a review of its risk management contracts had also revealed a previously announced $24.5 million loss was now estimated at $150 million.

The situation led to OW Bunker filing for bankruptcy on Friday.

Ship & Bunker reported last week that soon after the news broke, there was word that Dynamic Oil Trading had rejected claims of involvement in a fraud.

OW Bunker, meanwhile, on Friday said it had decided to report two key employees from Dynamic Oil Trading to the police over the matter.

Ship & Bunker has so far been unable to contact Møller or Dynamic Oil Trading for further comment, however some industry players who spoke to Ship & Bunker on the matter have questioned the timing of the dual announcement.

"For a fraud this size to only be discovered at the same time as the massive hedging loss? It's interesting timing," one source said.

Lars Henrik Hejlesen, Head of Global Sales at OW Bunker, this weekend in an emotional post on social networking site Facebook was reported to have said OW Bunker's collapse was down to the greed, incredibly poor judgment, and mad speculation of a "small handful of people".