A Goldman Sachs Group Inc. unit asked a court to halt Singapore tycoon Oei Hong Leong’s lawsuit over losses after he was allegedly misled into making leveraged trades that the yen would fall against the Brazilian real.
Goldman Sachs International said in a Nov. 6 filing with the Singapore High Court that proceedings should be suspended in favor of private and confidential arbitration. Court papers detailing reasons aren’t publicly accessible. A closed hearing is scheduled for tomorrow.
Oei, who in 2009 settled a claim against Citigroup Inc. over S$1 billion ($804 million) in trading losses, accused Goldman Sachs in his Sept. 20 lawsuit of making fraudulent representations that the real was a stable and liquid currency anchored to the U.S. dollar. He’s seeking $31.7 million in trading losses, plus interest.
Goldman Sachs will defend Oei’s lawsuit, which is without merit, Hong Kong-based spokesman Edward Naylor said yesterday.
Oei will challenge Goldman Sachs’s arbitration bid, his lawyer, Siraj Omar, said.
“Mr. Oei’s position is that the Singapore court is the proper place to decide the claim, especially since the misrepresentation that he is complaining about occurred in Singapore,” Omar said. “He sees no basis for moving this to confidential arbitration in London.”
Oei said in court papers he relied on claims by Mats Dewitte, Goldman Sachs’s executive director for fixed income, currencies and commodities in Asia, before betting on May 15 the Japanese currency would fall against the real.
The Brazilian currency fell to a four-year low in June after the U.S. Federal Reserve said it may moderate bond purchases that have fueled demand for emerging-market assets.
Oei, a Goldman Sachs client since 2001, describes himself as an experienced investor and a “prominent and highly-respected member of the Singapore business community,” according to his court papers.
“This is not a claim that is being brought because I am unhappy at the outcome of my investment decision,” Oei said in court papers. “As a result of this fraud, I have suffered significant losses.”
The case is Oei Hong Leong v Goldman Sachs International. S834/2013. Singapore High Court.