The Supreme Court has stopped a lower court decision that would have forced state-owned PrivatBank to pay $350 million to two oligarch brothers.
Last week’s decision by the Pechersk District Court drew condemnation from Prime Minister Denys Shymhal, the ministries of finance and justice, the central bank, and PrivatBank itself.
Ihor and Hryhoriy Surkis are Ukrainian oligarchs and ex-business partners of Ihor Kolomoisky, a former co-owner of PrivatBank. As alleged insider parties in a major fraud ring, they had their deposits in the bank turned into bank shares during its nationalization in 2016. They have filed many lawsuits to get the deposits back.
The Pechersk District Court on Sept. 3 ruled that the brothers’ six British companies can start withdrawing the first portion of the $350 million. PrivatBank refused to give it up, but the court-authorized law enforcement to help the Surkises take it by force.
The lower court made this decision before ruling on the merits of the case, which is illegal, according to multiple officials, including Shmyhal.
On Sept. 9, the high court stated that there is a “threat to the balance of interests” and issued an injunction against the lower decision until a cassation appeal can be heard.
PrivatBank praised the decision.
“Today’s decision… proves that the Supreme Court is careful to maintain the balance of interests of the parties in the trial,” wrote Petr Krumhanzl, the chairman of PrivatBank. “We are confident that this positive intermediate result will be followed by a fair and objective consideration of PrivatBank’s cassation appeal.”
Legal drama
Since the bail-in, the Surkises and other depositors have filed hundreds of lawsuits trying to get their money back. In total, they are suing for $1.16 billion.
The Pechersk District Court has yet to rule on the merits of this case. Nevertheless, in February, it upheld its 2017 decision that PrivatBank has to pay $259 million to the brothers’ offshore companies. In April, the Kyiv Court of Appeals rejected PrivatBank’s appeal against this decision.
On Sept. 2, the Pechersk District Court issued an enforcement ruling that PrivatBank has to pay $350 million, which includes the original amount plus interest. Then, on Sept. 3, two of the six offshore companies got approval to withdraw the first portion of the money, $165 million
The companies include Camerin Investments, Sunnex Investments, Tamplemon Investments, Berlini Commercial, Lumil Investments and Sofinam Investments.
A leaked report indicated that their deposits were fraudulent from the beginning.
The National Anti-Corruption Bureau of Ukraine has launched a criminal probe into the Surkis brothers’ attempt to seize PrivatBank’s assets through the courts.
