Credit Suisse Trust ordered to pay former Georgia prime minister and billionaire US$926 million

11 months ago 57

SINGAPORE: The Singapore International Commercial Court on Friday (May 26) ordered Credit Suisse Trust to pay compensation of US$926 million (S$1.25 billion) to tycoon and former Georgia prime minister Bidzina Ivanishvili and his family.

The court found that a fraudster within the ranks of the bank had embezzled many millions of dollars from the trust over nine years, and the defendant had breached its duty to safeguard his assets.

The case was heard over multiple days in September 2022 and February 2023, involving top lawyers including Senior Counsel Cavinder Bull and Ms Woo Shu Yan from Drew and Napier for the plaintiffs.

Lawyers from Allen & Gledhill, Ms Han Rebecca and Mr Justin William Jeremiah, represented Credit Suisse Trust, a wholly owned subsidiary of Swiss company Credit Suisse Trust AG, which is a subsidiary of the Credit Suisse Group. The defendant, Credit Suisse Trust, is incorporated in Singapore.

Mr Ivanishvili, along with his wife and three of their children, sued Credit Suisse Trust claiming damages of about US$1.2 billion. They were the beneficiaries of the Mandalay Trust.

Mr Ivanishvili was born in Georgia and obtained his education there, including a PhD in economic science. 

In the 1980s, he established and operated a business in partnership with business associate Vitaly Malkin, a Russian-Israeli business oligarch, importing cheap telephones and computers from Asia for sale in the USSR.

It was a very successful business, and both men used the profits to establish Rossiyskiy Kredit, one of the first privately owned banks in Russia.

Mr Ivanishvili's long relationship with Credit Suisse Trust in Singapore began in 2004, when an officer of the private investment banking arm of the Credit Suisse Group approached him and offered to assist him with wealth management services.

The bank and Credit Suisse Trust advised Mr Ivanishvili to use a structure, and he deposited over US$1.1 billion to be placed on trust in the Mandalay Trust with the objective of inheritance planning and asset holding.

However, the person appointed as the trust's relationship manager, Patrice Lescaudron, was a fraudster. Over nine years, he misappropriated many millions of dollars from the trust.

His conduct was halted only in 2015, and he was later arrested and jailed.

The Swiss Correctional Court found that Lescaudron had embezzled large amounts of money and bought securities a...

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