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Elliott hedge fund says it could take further action in response to LME nickel trades that were voided

Elliott hedge fund says it could take further action in response to LME nickel trades that were voided

Elliott Associates, a U.S. hedge fund, said Monday that it is considering taking further action against London Metal Exchange after a watchdog fined the exchange last week for allowing nickel to spiral out of control in 2013.

Elliott lost its lawsuit against the LME for cancelling millions of dollars in nickel trades when the price reached a record of over $100,000 per tonne by March 2022. This led the LME, which is the largest exchange in the world, to suspend nickel trading.

Elliott stated in an email that it felt vindicated following the Financial Conduct Authority's last week decision to fine the LME 9,2 million pounds, the first time a UK stock exchange has been sanctioned.

The FCA's final notice of 20th March, 2025 confirms that Elliott was right. Elliott said that the LME's failures had caused financial damage to many investors including Elliott.

"Elliott carefully reviews the FCA Final Notice and considers what further action it may take, if at all, in this matter."

Elliott didn't give any details about the next steps it is considering.

In October last year, Elliott lost its appeal against the dismissal by the LME of its lawsuit for the cancellation of nickel trades that the judges had deemed vital to the stability of the market.

The Supreme Court denied Elliott's appeal in January because the case did not present an "arguable legal point".

The FCA stated that the LME is responsible for numerous failures in dealing with severe market stresses, including only having junior staff on duty at the early morning hours of March 8, 2022 when nickel prices spiraled out-of-control.

Hong Kong Exchanges and Clearing Ltd. (Hong Kong Exchanges and Clearing Ltd.), which owns the 148-year old LME, has accepted these findings.

Elliott stated that the FCA Final Notice did not address the damage caused. (Reporting and editing by Eric Onstad, David Evans and Pratima Dasai)

(source: Reuters)