CS Victims: former Prime Minister of Georgia, Bidzina Ivanishvili, alleges political pressure in legal dispute with Credit Suisse
The case of the former Prime Minister of Georgia, Bidzina Ivanishvili, who has been engaged in ongoing legal disputes against Credit Suisse and its subsidiaries for over seven years has received widespread media coverage, including in Switzerland where the fraud and mismanagement were committed by the convicted Relationship Manager.
For several months, Mr. Ivanishvili and his representatives have avoided commenting on the case due to Credit Suisse instigating negotiations. However, it is now being reported that Mr. Ivanishvili alleged that the Bank was creating an illusion of negotiations and the Management of the Bank allegedly continued its campaign of political pressure against its former client.
Mr. Ivanishvili’s representatives have released a statement which includes the following:
“Those who have followed this story will remember that the ongoing dispute with Credit Suisse went beyond the legal scope and became political shortly after the military conflict started in Ukraine in February 2022. Within weeks, Mr. Ivanishvili faced problems both with accessing funds and receiving works of art and aircraft. Although some issues were resolved with great effort via legal means, the principal problem of accessing funds continues and we consider this to be informal sanctioning. These funds are unconnected to the ongoing legal disputes in Switzerland, Bermuda and Singapore, but relate to the amounts that survived the mismanagement and fraud at Credit Suisse. The majority of these funds were transferred to another Swiss bank, but around 5%, remained at Credit Suisse because of a formal requirement to ensure the viability of the ongoing disputes.
The said assets were and are managed through two trusts, financial structures which were recommended to Mr. Ivanishvili by Credit Suisse. One trust is located in Singapore and the other trust is under the jurisdiction of the Guernsey Islands (a British dependency) and it is the latter that manages the remaining funds at Credit Suisse. There is also the nuance that, in the absence of the Bank’s consent, the closing of the trusts requires a convoluted legal procedure and although the majority of the assets were transferred to another bank, the trust is still managed by the trustees appointed by Credit Suisse and made disbursements in line with the Beneficiaries’ wishes. However, since the start of the confict in Ukraine, the Beneficiaries encountered serious obstacles, including delays with disbursements, and the complete blocking of access to the funds. Mr. Ivanishvili alleges that these actions represent informal sanctioning ”
Although the lawsuits in Singapore and Bermuda are ongoing, the disputes in both jurisdictions are long-standing: the lawsuit in Bermuda was filed in 2016, and the final determination of jurisdiction in Singapore was confirmed in March 2020. Thus, the final submissions stage in which the parties referred to new facts, evidence and claims was filed in November 2021. Accordingly, Mr. Ivanishvili was advised that the issue of access to the funds could no longer be brought to the attention of the Courts as part of the ongoing disputes. Nevertheless, during the Singapore court hearing in September 2022, Mr. Ivanishvili appeared as a witness and claimed that Credit Suisse not only forced him to claim the defrauded and mismanaged funds in different jurisdictions for years, but had also not made the payments in breach of the the Geneva Court order at the criminal trial of the Relationship Manager in 2018. Moreover, Credit Suisse had restricted access to the residual funds withdrawn from the Bank but remaining under the management of trustees appointed by Credit Suisse.
As a result, the Court asked Credit Suisse the question of why non-disputed funds were not transferred to the client.
Following this exchange, Credit Suisse initiated negotiations with Mr. Ivanishvili, and during this process they returned a significant part of the amount that had been ordered by the Swiss court three years earlier. In December 2022, Mr. Ivanishvili was paid the interest accrued due to late payment of the aforementioned amount and the Bank also paid the amount that the Singapore trust of Credit Suisse did not dispute. Mr. Ivanishvili has since claimed these payments were an illusionary attempt by Credit Suisse to act in good faith to project a positive image to the Court and considers all illusions have ended.
On 14th December 2022, the European Parliament voted on a resolution recommending the imposition of sanctions against Mr. Ivanishvili, but this has not been adopted by the executive bodies of the European Union. Against this background, Credit Suisse made the last transfers to the client and it is now claimed that this development has prevented resolution of the issues with the Guernsey trust. This claim is strengthened by the fact that the assets have been transferred away from Credit Suisse and the Bank and its appointed Trustees should have no interest in not following the Beneficiaries’ instructions. As a result, Mr. Ivanishvili sees this obstructive action as ‘political pressure’ as it was in March when Credit Suisse claimed the delays in making disbursements was due to “the geopolitical situation in Eastern Europe”.
Mr. Ivanishvili alleges that Credit Suisse has a record of using draft resolutions of the European Parliament to justify delays in making disbursements from the Guernsey Trust.
Following the first of these on 9th June 2022, Credit Suisse stated that the Trust was unable to make disbursements; however, the resolution was not adopted at the European Council meeting in July and there was no legal bais why these could not be made. As a result, an application was filed in the Guernsey Court to return the Trust’s assets, but the one-day hearing has been postponed on numerous occasions and although this is planned for March, Mr. Ivanishvili believes the date will be postponed again. As a result, during the negotiations, Mr. Ivanishvili’s representatives proposed to to settle the issue of the money frozen by the Guernsey trust in a short time without the involvement of the Court, but this offer was not accepted.
The situation is further complicated by a lack of consistency in the management of the trusts. Allegedly, one of the trusts does not make distributions and forces the Beneficiaries to seek legal redress for disbursements, with the Trustees referencing the June resolution of the European Parliament, whilst the other trust is able to make disbursments to the Beneficiaries as required, despite the further resolution in December and was clearly not a problem for the Management of Credit Suisse. It is claimed that this is the real “price” of the resolution of the European Parliament, and Credit Suisse knows this “price”. It would be correct for the Bank to act in the first case as well as in the second case. Under these conditions, it turned out that both resolutions could be ignored in order to avoid the negative impression of the Singapore Court.
Mr. Ivanishvili claims that this shows Credit Suisse’s campaign of political pressure is continuing and, as a result, Mr. Ivanishvili and his advisers are now considering a campaign to publicise additional information on the situation as well as releasing evidence on how, in his opinion, the Management of Credit Suisse has damaged the reputation of the Bank and the image of Switzerland itself.
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