Mikhail Fridman’s Alfa Group has been hired to recoup millions of dollars in foreign assets from fallen oligarch Sergei Pugachev — a former Russian financier, billionaire and politician dubbed “Putin’s Banker.”
Russia’s Deposit Insurance Agency (DIA), an organization tasked with recovering lost deposits from owners of banks which have gone bust, has been chasing Pugachev’s overseas wealth since Russia launched criminal cases against him in the mid-2010s.
Russia holds Pugachev responsible for 75.6 billion rubles ($1.1 billion) in funds which were lost when Mezhprombank — a bank he founded in the early 1990s — went bankrupt in 2010.
Pugachev was worth around $2 billion on the eve of the 2008 financial crisis, according to Forbes, and he is credited with helping Putin ascend to the top of Russian politics in the late 1990s.
The oligarch fled Russia in 2011 after obtaining French citizenship in 2009. Russian authorities launched cases to hold him liable for Mezhprombank’s debts and recover his foreign assets shortly after. He argues that the case against him is politically motivated, following a falling out with the Kremlin, saying Russia “expropriated” his assets after he left the country.
Pugachev lost a case in a French appeals court in June against the seizure of his property — a ruling which the DIA says paves the way for it to move in. According to reports in Russian media outlets, the DIA has hired A1 Group — part of Alfa Group, a private Russian investment and banking giant — to attempt to seize Pugachev’s property in France, where he allegedly resides.
A1 has a “reputation as a ruthless debt collector,” Russian business outlet The Bell reported Tuesday, and will carry the costs of asset recovery in return for a slice of anything they are able to retrieve.
The appointment of A1 is the latest development in the long-running and high profile legal saga.
Pugachev previously had more than £1 billion of assets frozen by the High Court in London, where the DIA was able to seize property worth millions of pounds. After those rulings and in violation of a travel ban, he fled the U.K. for France in 2015 citing fears for his safety. The High Court subsequently sentenced him to two years’ imprisonment in absentia.
This June, The Hague threw out Pugachev’s attempt to countersue Russia for $14.5 billion in damages, ordering the ex-banker to pay almost $6 million to Russia to cover the Justice Ministry’s legal fees. Pugachev has said he will appeal both that decision and the French ruling on asset seizures.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
