MOSCOW, February 28. /TASS/. The Moscow City Court has upheld the detention of Baring Vostok’s founder Michael Calvey on charges of fraud to the tune of 2.5 bln rubles ($37.5 mln) as legal, a TASS correspondent reported from the courtroom.
"[The court hereby] rejects the defense’s appeal against choosing custody as a preventive measure for Calvey and upholds the previous court’s ruling," the judge announced.
The defense insists that Calvey’s alleged crime is linked to his business activity, and therefore the accused cannot be taken into custody.
"Calvey’s actions, which are being considered by the court, were reviewed as part of his position’s managerial duties in a private company. According to the decision of the Plenum of the Supreme Court, this is purely an entrepreneurial activity," attorney Dmitry Kletochkin explained.
The lawyer said that Calvey was not involved in the embezzlement and that the probe did not have objective information about him.
"The investigation has not conducted an objective assessment of the company's shares, whose value was allegedly overstated by Calvey," Kletochkin noted.
The legal team of Vostochny Bank minority shareholder, Sherzod Yusupov, who had previously sent a statement to the Federal Security Service (FSB) to launch a criminal case against Calvey, asked the court to keep the founder of Baring Vostok in custody on charges of fraud.
"I believe that Calvey’s crime was not committed in the business field, because entrepreneurship is an honest way of making a profit and can never be associated with perpetrating a crime. Therefore, I believe that keeping Calvey in custody is lawful and completely reasonable," Yusupov’s counsel told the court.
The investigator also requested pretrial detention for Calvey. According to him, this measure would allow the investigation to collect the necessary evidence and to avoid putting pressure on the witnesses.
On February 27, a Moscow court dismissed four appeals from the case’s defendants - Baring Vostok’s partner Vagan Abgaryan, investment director of Baring Vostok Ivan Zyuzin, former head of Vostochny Bank Alexei Kordichev, former director of the First Collection Bureau Maxim Vladimirov.
The appeal of another person involved in the case, Philippe Delpale, Director of the Financial Department of Baring Vostok, will be considered on March 1.
They are all facing charges under part 4 article 159 of Russia’s Criminal Code (Swindling committed on a large scale by an organized group) and will be held in custody until April 13.
Russia’s Investigative Committee launched a criminal case into the embezzlement of 2.5 bln rubles ($37.5 mln) from Vostochny Bank on February 13. Michael Calvey is the key defendant in the case. On February 15, the law enforcement agencies arrested Calvey and five others: Vagan Abgaryan, partner at Baring Vostok, Philippe Delpale, an investment partner for the financial industry sector at Baring Vostok, Ivan Zyuzin, Investment Director at Baring Vostok and also General Director of the First Collection Bureau Maxim Vladimirov and Advisor to the Management Board of Norvik Bank, Alexey Kordichev.
According to the investigation, Calvey and his accomplices put together a scheme, where the "First Collection Bureau", under their control, waived its right to a 59.9% stake in a Luxembourg-based company called the International Financial Technology Group (IFTG), to the Vostochny bank to pay it back for a 2.5 billion-ruble debt. Before the deal, IFTG’s shares were valued at 3 bln rubles. However, the investigation is examining another estimate of 600,000 rubles (according to a Cyprus-based company’s valuation). That said, the Central Bank claimed that the price of these shares was close to zero, the investigator noted.
On February 7, Serzod Yusupov, a minority shareholder in Vostochny Bank filed a complaint with Russia’s Federal Security Service (FSB).
Baring Vostok is one of the largest private equity firms focusing on Russia and the CIS with $3.7 bln in capital. Since 1994, the fund has poured more than $2.4 bln of investments into 70 projects in the areas of financial services, oil and gas, telecommunications and media, and into the consumer sector. Baring Vostok’s projects include CTC Media, Yandex, Avito, Ozon, ER-Telecom, 1C, and Novomet.