Credit Suisse intends to appeal against the decision of a court in Bermuda against a local insurance subsidiary, Credit Suisse Life Bermuda.
This court considers that the billionaire and former Georgian Prime Minister Bidzina Ivanishvili suffered losses during investments made through the subsidiary of Credit Suisse due to the mismanagement of a financial adviser.
The second Swiss bank had already mentioned last week the possibility of a judgment which could lead to a payment of more than 500 million dollars. Provisions have also been made by the Zurich establishment.
However, this is not yet a final judgment and the court’s decision can still be challenged, a statement from Credit Suisse said on Tuesday, already embroiled in the debacle of the Archegos and Greensill funds.
According to the court ruling in Bermuda seen by AWP, the damages Credit Suisse must pay for ‘breach of contract and misrepresentation’ have yet to be calculated by experts.
The conflict between Credit Suisse and Mr. Ivanishvili dates back to 2011. Client of the bank with two veils, the billionaire, who built his fortune in the trade of computers and telephones, then created the banking establishment Rossiysky Kredit, sold in 2012, was one of the victims of the fraudulent actions of a Credit Suisse adviser, Patrice Lescaudron.
Dismissed by the institute and sentenced in 2018 in Geneva to five years in prison for fraud by profession, simple and aggravated unfair management as well as forgery in the titles, the banker committed suicide in 2020.
Revenue priority
The subsidiary in Bermuda, for its part, did not take the necessary measures to prevent the actions of the adviser ‘because it gave priority to the income generated by Mr. Lescaudron on behalf of Credit Suisse over the interests of its clients’, estimates the judge.
Last week, the bank with two veils indicated that it wanted to take all legal measures at its disposal in the context of this procedure, for which provisions have already been made.
For the time being, Credit Suisse is considering whether to supplement these in the context of the publication of the financial results for the first quarter of 2022 on April 27.
In its 2021 annual report, Credit Suisse indicated that it had provisioned a total of 1.54 billion francs in the year under review to settle legal disputes. For the fourth quarter alone, the big bank has set aside 436 million for this purpose.
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