Cocoa firm Transmar Group's woes mount as ABN Amro, others sue for fraud
By Chris Prentice NEW YORK, Jan 11 (Reuters) - Eight banks including a unit of ABN Amro, Société Générale and BNP Paribas have sued executives of New Jersey-based Transmar Group for defrauding them of $360 million in credit lines, just a year after a unit of the firm filed for bankruptcy.
The group of banks, which include some of the world's top commodities lenders, claim the eight executives including founder and Chief Executive Peter G. Johnson knowingly overstated the value of assets and the company's financial state to qualify credit lines, according to a document filed in a U.S. District Court in New Jersey on Monday.
Macquarie and Natixis were also among the top lenders involved in the lawsuit, the latest development in the unraveling of the cocoa firm, which sold cocoa products to chocolate makers such as Hershey Co and Nestle SA . The U.S. unit filed for bankruptcy in late 2016 and later became the subject of a fraud investigation.
Transmar's bankruptcy proceedings exposed international emails related to a years-long fraudulent conspiracy, the banks said. Transmar lied repeatedly from 2014 to December 2016 to inflate the amount of collateral used to support Transmar's borrowing, according to the filing.
Federal prosecutors in August 2017 charged Peter G. Johnson, his son Peter B. Johnson, who oversaw the company's European affiliate, and finance vice president Thomas Reich with fraud. The three men have pleaded not guilty.
This week's lawsuit broadens the allegations beyond those three executives to another five, including Mary Johnson, the senior Johnson's wife and a director and senior vice president at the company, and Timothy Johnson, another son and Transmar's chief operating officer.
"Defendants went to extraordinary lengths to conceal their fraud — including maintaining two sets of books and records," the banks said.
Counsel for the plaintiffs declined to comment for this story. A lawyer for Transmar did not respond immediately to request for comment.
Below is a breakdown of the amounts owed, per the Jan. 8 filing: Lender Principal Interest owed, Total owed, as of as of 12/31/16 12/31/16 ABN $75,875,621 $948,409.64 $76,824,030.64 Soc Gen $62,485,806 $781,043.23 $63,266,849.23 BNP $53,559,262 $669,465.63 $54,228,727.63 Natixis $53,559,262 $669,465.33 $54,228,727.33 Macquarie $40,169,446 $502,099.22 $40,671,545.22 Hapoalim $31,242,903 $390,521.61 $31,633,424.61 The Bank of $26,779,631 $334,732.81 $27,114,363.81 Tokyo-Mitsu bishi UFJ Ltd Israel $13,389,815 $167,366.41 $13,557,181.41 Discount Bank of New York Total $357,061,747 $4,463,104.18 $361,524,849.88 (Reporting by Chris Prentice; Editing by Matthew Lewis)
