A unit of defunct lender Credit Suisse will seek to overturn an order to pay US$743 million (S$1 billion) to a billionaire client over the actions of a notorious rogue banker at Singapore’s top court on April 8.
The sum was awarded after a lower court earlier ruled that the bank’s trust had failed to safeguard the assets of Bidzina Ivanishvili, the former prime minister of Georgia. It was revised down from an initial US$926 million in a sprawling case spanning three continents.
Nevertheless, lawyers for Credit Suisse Trust are again trying to get the award cut. They previously argued that the verdict was “wrong and poses very significant legal issues.” A spokesman for the bank declined to comment. Since the litigation began, Credit Suisse has been taken over by rival UBS Group.
The fallout centres around the case of private banker Patrice Lescaudron who was convicted in 2018 for running a fraudulent scheme in which he took money from Mr Ivanishvili’s accounts to try and mask growing losses in other, Russian clients’ portfolios.
Lawyers for Mr Ivanishvili have always contended that the banker’s supervisors were aware or should have known of Lescaudron’s subterfuge, and if they didn’t should be held criminally negligent. The bank has always consistently countered that the Frenchman was a “lone wolf” who hid his crimes from his colleagues and bosses.
The Bermuda judge who ruled against Credit Suisse in 2022 said the unit in that island nation had turned a “blind eye” to the rogue banker. It was the bank’s mishandling of that case among others, that contributed to the plunge in shareholder confidence in the bank and its eventual takeover by UBS in March 2023. Mr Ivanishvili won more than US$600 million in the Bermuda ruling. BLOOMBERG