‘Putin’s banker’ Pugachev files claim against Russia in The Hague: source

Reuters, LONDON

Wed, Sep 23, 2015 - Page 7

Sergei Pugachev, a tycoon once dubbed “Putin’s banker” because of his influence in the Kremlin, has filed a claim against Russia for more than US$10 billion after his business empire was carved up when he fell out of favor with Russian President Vladimir Putin.

Lawyers for Pugachev on Monday issued notice of a claim against Russia that is likely to be heard in the Permanent Court of Arbitration in The Hague, a source close to Pugachev told Reuters on condition of anonymity.

Pugachev’s lawyers yesterday were to outline his claim against Russia in Paris, the source said.

It was not immediately possible to get a response from the Russian government, which is seeking Pugachev’s arrest for embezzlement and misappropriation of assets, charges he denies.

Moscow is already fighting a separate ruling from last year by the same court, which ordered it to pay US$50 billion for expropriating the assets of Yukos, once Russia’s biggest oil producer and run by Mikhail Khodorkovsky.

“Mr Pugachev has patiently waited for this moment to strike with this massive investment claim second only to Yukos,” said a person close to Pugachev, who spoke on condition of anonymity.

“He wants to ensure that those persons responsible for the unlawful taking of his businesses, including those in the Kremlin, are named and shamed,” the source said.

Since leaving Russia in 2011, Pugachev, 52, has accused Putin’s allies of forcing his multibillion-dollar business empire to its knees before picking off its best assets.

Pugachev founded Mezhprombank, or International Industrial Bank, in 1992, just a year after the collapse of the Soviet Union. It grew to become one of Russia’s biggest banks, with stakes in the “Northern” and “Baltic” shipyards and a giant Siberian coal deposit.

However, having helped Putin ascend to Russia’s top job in 1999 during the last days of Boris Yeltsin’s presidency, Pugachev fell out with some of Putin’s most powerful allies in the years after the 2008 financial crisis.

Russian officials say Pugachev helped himself to more than US$700 million in Russian central bank bailout money intended to help Mezhprombank through the crisis.

At Russia’s request, Interpol has issued an arrest warrant for Pugachev.