Tensions are rising within the long-running and more and more advanced battle over the dramatic nationalisation of Russian financial institution Promsvyazbank.
Readers of our story in August could do not forget that brothers Dmitri and Alexei Ananyev had fled Russia after the financial institution, which they based and beforehand owned, fell into administration and was taken over by the nation’s central financial institution in 2017 (although not earlier than some fairly uncommon transactions in its shares). Alexei moved to the UK, whereas Dmitri went to Cyprus.
Russian authorities put out a warrant for his or her arrest and charged them with embezzlement of round $1.6bn. A lawyer for Alexei mentioned the fees and warrant for his arrest had been “completely groundless”. Dmitri maintains he’s the sufferer of a politically motivated nationalisation and he did nothing mistaken. Based on the brothers, Interpol’s Normal Secretariat says the accusations towards Dmitri and Alexei have a political dimension to them and they’re now not topic to an Interpol discover. Interpol declined to remark.
Now a courtroom case within the Netherlands this week may shed additional gentle on what occurred at PSB, because the financial institution is thought, across the time of its nationalisation.
This case is being introduced by among the largely Russian savers (together with the proprietor of a fertiliser firm and a wine service provider) who’re looking for a strategy to get their a refund after they purchased $240m of assured notes offered by PSB that subsequently defaulted.
The brothers have an online of offshore firms across the globe, and claimants say they’ve discovered it exhausting to determine the place to pursue a authorized grievance.
Nevertheless, the claimants have just lately been aided by enter from a bunch of enthusiastic German MPs and MEPs who’ve taken up their combat. These politicians have been briefed on the Ananyevs by high-profile lawyer John Sandweg — former appearing common counsel on the US Division of Homeland Safety and now a lawyer advising some noteholders. After an industrious method to letter-writing to numerous political leaders, stress is now constructing in some jurisdictions.
With German savers mentioned to be among the many alleged victims (and little question aware each of Commerzbank’s shareholding in PSB between 2006 and 2012, in addition to the embarrassment of the Wirecard fraud again dwelling), the German politicians have written to European Fee President Ursula von der Leyen, UK Chancellor Rishi Sunak, Residence Secretary Priti Patel, Cyprus’s Minister of Finance Constantinos Petrides, European Commissioner for Justice Didier Reynders, the Netherlands’ Minister of Inside Kajsa Ollongren . . . the checklist goes on.
All that glitters
A September letter from MEP Sven Schulze to Mr Sunak, for example, raised questions over the provenance of the cash used to achieve residency within the UK and Cyprus. Mr Schulze has requested Dishy Rishi for entry to the data the brothers disclosed within the UK residency utility — together with the revenue sources given for the brothers’ wives and youngsters — and for that utility to be scrutinised.
He has additionally requested Cyprus’s Mr Petrides to look at Dmitri’s visa utility in Cyprus, which was made below the nation’s so-called golden visa course of.
That course of got here into the highlight in October when, following an Al Jazeera undercover investigation, Cyprus suspended its golden passport scheme. The European Fee has additionally launched authorized motion towards the nation. The Fee had been irked by the truth that such schemes seem to let rich people purchase the advantages of EU membership, following controversial circumstances involving Malaysian businessman Jho Low, and family members and associates of Cambodia’s authoritarian prime minister Hun Sen.
One of many letter-writers, German MP Peter Beyer, informed us he’s now requesting “severe reclaiming of already-issued golden passports by the Cypriot authorities, since this observe clearly is opposite to European frequent pursuits”.
Dmitri’s stance is that, in contrast to candidates who hid the supply of their cash, his utility was primarily based on paperwork verified by Cypriot authorities and is supported by his lengthy monitor document within the banking sector and the actual fact PSB had a department in Cyprus.
Alexei’s lawyer mentioned any such issues raised by the German politicians appeared “deceptive and never correct”.
In Russia, in the meantime, investigators just lately arrested 5 folks and put 4 extra on a needed checklist in reference to the alleged siphoning off of funds at PSB.
In George City within the Cayman Islands, some noteholders filed a writ within the Grand Court docket in October. The declare, printed on the courtroom’s web site, alleges that Dmitri’s “dishonest scheme . . . fraudulently” moved the proceeds of the notes into his firms. Dmitri apparently has not obtained discover of the case.
And within the Netherlands, some noteholders gained a probably vital victory in August when a decide dominated the 2 administrators of a Dutch firm owned by the brothers might be questioned.
Noteholders hope the listening to, scheduled for this week, will assist them present whether or not the administrators acted on the brothers’ directions in finishing up the weird share transactions simply earlier than PSB was nationalised.
They hope that proof may, in flip, show helpful in asking the UK Excessive Court docket to rethink a freezing order on the brothers’ belongings. Final yr a decide threw out the noteholders’ declare towards the brothers’ English firms, ruling England was not the proper jurisdiction, ordering frozen cash to be repaid to Dmitri and the noteholders to pay prices.
The decide additionally mentioned that “essentially the most pure targets for any declare are PSB and (probably) the primary defendant [Dmitri]”.
Final week a courtroom in Cyprus issued an order for the seizure of the worldwide belongings of the brothers and their wives for as much as €267m, in response to Kommersant. Alexei “had nothing to do with the alleged unlawful actions or transactions acknowledged within the declare”, a spokesperson reportedly informed the newspaper. Dmitri’s spokesperson informed the paper the defendants “categorically disagree with the calls for made within the Limassol District Court docket and dispute them”.
Dmitri, a former member of the higher chamber of the Russian parliament, contests most of the allegations and issues raised. His place, in a nutshell, appears to be that previous to the Russian central financial institution’s intervention, PSB had a robust worldwide fame, and that he’s the sufferer of a politically motivated nationalisation.
He has filed an utility to the European Court docket of Human Rights, which was declared inadmissible by an ECHR decide, the ECHR informed us (there may be understood to be a difficulty in the mean time about jurisdiction). Nevertheless, a separate utility, PSB vs Russia, is “into account”, the ECHR mentioned.
From Dmitri’s authorized illustration:
Issues associated to Russia’s nationalisation of PSB are the topic of impartial judicial scrutiny. We anticipate that to place an finish to the years of unfounded accusations Mr Ananiev has since confronted.
A lawyer talking on behalf of Alexei mentioned his shopper didn’t “at any time… have authority or capability to have an effect on the transactions” of PSB or every other entities. The UK Excessive Court docket decide final yr mentioned that, whereas PSB had been collectively owned by the brothers, it was “Dmitri’s enterprise”. Alexei by no means had an government or managerial position on the financial institution, though he did have a non-executive position on its supervisory board, the decide mentioned.
Victims of alleged frauds unfold throughout offshore jurisdictions hardly have an incredible monitor document of getting their a refund. Company secrecy, a scarcity of worldwide co-operation, questions of jurisdiction and the sheer value of such courtroom circumstances finally delay many complainants.
Nevertheless, within the case of PSB, issues seem slowly to be coming to a head. Helped by some German politicians’ enthusiastic letter-writing, extra particulars about what actually went on at PSB — together with what occurred to noteholders’ cash — may finally come out within the numerous contested courtroom proceedings.
We might be watching.
Cayman, Curaçao and Cyprus: the hunt for $240m of Russian financial institution bonds — FT Alphaville