A hearing before Mr Justice Fancourt has taken place today in the High Court in London in relation to applications heard by the Judge between 25 and 30 July 2018. The Judge found that the evidence is strongly indicative of an elaborate fraud and money laundering on a vast scale, that the Defendants admit the Bank has a good arguable claim for at least hundreds of millions of dollars and that the supply agreements complained of by the Bank were shams used as a deceptive basis on which to justify very large sums of money flowing out of the Bank. Despite the judge finding that the Bank has a good arguable case to have been the victim of a massive fraud – between US$329 million and US$1.2 billion - he concluded that the English court does not have jurisdiction over its claims against its former shareholders. The judgment has not yet been handed down in final form, whilst the Judge considers further submissions on the quantum of the Bank’s good arguable case made this morning.
This judgment is just the first stage of the process and the Bank has been granted permission to appeal the decision on jurisdiction and is confident that it will ultimately succeed in bringing its claims to trial in London. The freezing order will remain in place in full until the Court of Appeal has heard the Bank’s further application for permission to appeal on other grounds.
PrivatBank's CEO, Petr Krumphanzl, said "The judge found that the Bank has a good arguable case that the former shareholders are responsible for a multi-billion Dollar fraud on the Bank. We remain committed to recovering these funds through the London court process and retain our faith that the English court will ultimately do justice between the parties".
Richard Lewis, Partner at Hogan Lovells, said "This decision involved a number of complex areas of the law in the jurisdictional context, which the judge himself accepted were far from straightforward. It was all but inevitable that those points – which were critical to the determination of the Defendants' jurisdiction challenges – would ultimately fall to be determined by the Court of Appeal, and we are confident that they will be resolved in the Bank's favour. If, as we expect, the Bank's claims ultimately proceed to trial in England, the fact that the Defendants have made no attempt to justify the documentation used to justify the misappropriation will make it very difficult for them to defend the Bank's claims on the merits".