Baring Vostok has asked Russian President Vladimir Putin in an open letter to take personal control of the criminal case initiated against its founder Michael Calvey, who is suspected of embezzling 2.5 bln rubles ($37.5 mln) from the Vostochny bank, and other defendants in the case, TASS reported.
"In order to ensure a comprehensive, independent and objective investigation of this criminal case, we ask that you take personal control of the criminal case that has been initiated against M. D. Calvey, V. L. Abgaryan, I. N. Zyuzin, P. Delpal, M. S. Vladimirov and A. S Kordichev," a respective letter released on the fund’s website on Monday said.
Baring Vostok emphasized that the letter to the President of the Russian Federation has been published "in response to the large number of requests from (the fund's - TASS) friends and partners."
According to the letter, "Russian courts and law enforcement authorities in recent years have reduced the use of imprisonment as a form of pre-trial detention for cases related to commercial activities." "This approach has helped eliminate the possibility of putting undue pressure on a business partner as part of a business conflict. Despite these legal requirements, the individuals listed above have been imprisoned during the pre-trial period," the letter noted.
Baring Vostok’s case
As reported earlier Russia’s Investigative Committee launched a criminal case into the embezzlement of 2.5 bln rubles ($37.5 mln) from the 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. 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).
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 bln-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.
Baring Vostok, one of the largest private equity firms focusing on Russia and the CIS, 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 since 1994. Baring Vostok’s projects include CTC Media, Yandex, Avito, Ozon, ER-Telecom, 1C, and Novomet.