Metals Traders Lose at Least $144 Million as ‘Hat’ Flees China

Chinese metals traders have racked up losses totaling at least 1 billion yuan ($144 million) after one of their counterparties fled the country leaving deals unfinished, alarming top regulators worried about hidden financial risks, according to people familiar with the matter.

At the heart of the crisis is a trading network facilitated by Xu Maohua, a metals dealer nicknamed The Hat, said the people, including some who worked with or did business with him and are directly affected by the losses. State-backed SDIC Commodities Co. was the highest-profile participant, they added, asking not to be named given the sensitivity of the matter.