Bermuda Court Orders Credit Suisse to Pay $555 Million in Damages to Bidzina Ivanishvili

Bermuda Court Orders Credit Suisse to Pay $555 Million in Damages to Bidzina Ivanishvili

According to The Wall Street Journal, a Bermuda court has ordered Swiss giant Credit Suisse to pay about $ 555 million to Bidzina Ivanishvili.

The Supreme Court of Bermuda said that the Swiss commercial bank allowed the personal banker of the former Prime Minister of Georgia to mismanage the billionaire’s money and steal part of it.

It is noteworthy that Credit Suisse has already mobilized the amount of money needed in reserves. On March 23, the bank stated that they expected fines imposed due to litigation in the Bermuda Islands. Credit Suisse also indicated that this transaction was related to a dispute in their investment banking sector. The bank said in the same statement that this might not be the total amount of the fine and that Credit Suisse would increase the fund’s budget for compensation if necessary.

On March 29, 2022, the Supreme Court of Bermuda ruled that Credit Suisse knew, or should have known, the existence of the fraudulent scheme of banker Lescadron.

Final damages in the Bermuda case would be based on a calculation of what Mr Ivanishvili would have made from his Bermuda accounts if his money had been invested in a medium-risk investment portfolio through March 29. According to The Wall Street Journal, an initial calculation put that amount at roughly $555 million through July 2020. 

A spokesman for Mr Ivanishvili stated that Credit Suisse still refuses to compensate the billionaire for the stolen money. However, the bank admits it was stolen. The dispute over the same case between the bank and Ivanishvili continues in Singapore.

Credit Suisse Group itself issued an official statement on the Bermuda court ruling. „The judgment relates to life insurance policies of one client of Credit Suisse Life Bermuda. The life insurance subsidiary has been closed to new business and in wind-down for more than seven years and has no other material business that will be affected by this judgment. The judgment is not yet final and is subject to appeal, which Credit Suisse Life Bermuda intends to vigorously pursue.“

Recall that Bidzina Ivanishvili was a client of Credit Suisse’s banker, Patrick Leskadron. Ivanishvili later sued Credit Suisse in Singapore, New Zealand and Bermuda, demanding $ 800 million in damages from the bank. According to Bloomberg, Ivanishvili was the biggest victim of Leskadron. Ivanishvili himself thought it impossible for such a scheme to be known only to Leskadron in the bank.

According to various court records, in 2005, Credit Suisse set up a trust in Singapore called the Mandalay Trust. Ivanishvili placed a $ 550 million deposit there. In December 2014, $ 697.68 million was transferred to the company, while in September 2015, only $ 437.8 million remained in the trust account. At the same time, Ivanishvili made a $ 755 million deposit to the Credit Suisse Life office in Bermuda. This contribution was in the form of an “insurance premium”, and the Swiss bank was responsible for its investment. In 2015, Bidzina Ivanishvili discovered that $ 400 million had disappeared from the insurance scheme in connection with fraudulent operations in Credit Suisse by his former personal banker, Patrice Lescadron.

Former Credit Suisse Group AG banker Patrick Lescadron has been found guilty of fraud by a Geneva court and sentenced to five years in prison in 2018. Due to his health condition, he was released from prison in 10 months – he committed suicide two years ago.

Ivanishvili has made only a few public statements regarding this case: “No matter how long it takes, I will not back down from this case. I have not seen such fraud in savage Russia or the Georgian banking sector in the 1990s,” he told Bloomberg in November 2019.

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