Hogan Lovells Delivers Victory in $150 Million Fraud Case for Leading Russian Financial Group Otkritie
11 February 2014
London, UK -
London's High Court has delivered its judgment today on a multi-million dollar fraud against Otkritie, one of the largest financial services providers in Russia. Otkritie was defrauded by a group of former employees and their associates. Today's judgment paves the way for the recovery of millions in already frozen assets and awards significant damages to Otkritie. Hogan Lovells has advised Otkritie throughout the dispute.
The case, which lasted 46 days in the Commercial Court, spanned over 20 jurisdictions and drew on Hogan Lovells network of global offices including Moscow, London, Paris, Hong Kong, Madrid and Amsterdam. The team advising Otkritie was led by corporate relationship partner Oxana Balayan in Moscow and litigation partners Neil Mirchandani and Crispin Rapinet in London, supported by Of Counsel Neil Dooley. The multinational team at Hogan Lovells further included over 100 lawyers and associates across the firm. The firm instructed Steven Berry QC, as Leading Counsel, with Nathan Pillow and Anton Dudnikov all of Essex Court Chambers.
Oxana Balayan of Hogan Lovells commented: "This is another great example of a leading financial institution's use of innovative strategies to pursue, and bring to justice, a global and multi-million dollar fraud dispute. Our lawyers at Hogan Lovells acted as an extension of Otkritie's legal team, utilising our firm's global reach and strength in litigation to help the bank secure a comprehensive victory."
Neil Mirchandani of Hogan Lovells commented: "This has been a hard-fought case which has necessitated Otkritie taking multiple steps around the world to follow the fraud monies. Our international network has been crucial in supporting this effort. It is also a testimony to the efficiencies of the London Commercial Court that this matter was brought to trial in under 2 years with a lengthy and detailed judgment delivered shortly afterwards."
Dmitriy Popkov, Deputy CEO of Otkritie, said: “We have been most impressed by Hogan Lovells’ expertise, broad international perspective and hard work, which have all contributed significantly to achieving this important victory.”
The judgment confirms that George Urumov, Ruslan Pinaev, Sergey Kondratyuk, Eugene Jemai and Vladimir Gersamia all conspired to defraud Otkritie through a complex fraudulent trade. The Judge found that the defendants defrauded Otkritie of $173 million then used their friends and families to launder the proceeds through dozens of offshore companies and bank accounts. The money was then spent on lavish villas, luxury sports cars and diamonds.
Mr. Justice Eder concluded that Otkritie was defrauded following "a cunning and well-orchestrated fraud."
The Geneva Public Prosecutor has been pursuing a parallel criminal investigation and has brought charges of fraud and money laundering against Ruslan Pinaev (a fugitive in Israel), Swiss resident Mr. Jemai, his mother Olessia Jemai and others. The City of London Police has arrested Mr. Urumov, his wife Ms.Yulia Balk, Mr. Gersamia and others and taken their passports while releasing them on bail. Today's Commercial Court judgment opens the way for the Crown Prosecution Service to take a decision on filing criminal charges.
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