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These are Russia's charges against American investment manager Michael Calvey, and here's why he says it's all baloney

Source: Meduza

What prosecutors say: First Collection Bureau (PKB), a company owned by the American investment manager Michael Calvey, borrowed 2.5 billion rubles ($37.7 million) from Vostochny Bank. Instead of repaying that loan, Calvey transferred his shares in another company called IFTG to Vostochny Bank in February 2017, telling the bank’s board of directors that the shares were worth nearly 3 billion rubles ($45.3 million). In February 2019, Vostochny Bank board member Sherzod Yusupov went to the Federal Security Service (FSB) and accused Calvey and the other participants in the deal of deceiving him. The FSB says it then verified these allegations, finding an audit assessment allegedly stating that IFTG was worth just 600,000 rubles ($9,050), not 3 billion rubles. Prosecutors say this is how Calvey and his accomplices committed fraud.

Want this explained in simpler terms?

Sherzod Yusupov says Michael Calvey gave him a busted company to cover a loan one of his businesses owed.

What Michael Calvey says: When carrying out the IFTG deal, no one deceived Sherzod Yusupov, who had direct access to all the information involved in the transaction. Yusupov and Artem Avetisyan are shareholders who gained stakes in Vostochny Bank after its merger with Uniastrum Bank in 2017. Baring Vostok learned that Avetisyan withdrew considerable sums of money from Uniastrum Bank through dummy transactions on the eve of the merger with Vostochny Bank. In response, Baring Vostok filed a lawsuit in the London Court of International Arbitration. Calvey says Yusupov is trying to use false criminal allegations in Moscow to pressure Baring Vostok into withdrawing its lawsuit in London, and prevent the dilution of Avetisyan’s Vostochny Bank shares in a follow-on offering planned this April (to boost the bank’s capital reserves, in accordance with demands from Russia’s Central Bank).

Want this explained in simpler terms?

The company Calvey turned over wasn't busted, and Yusupov only says it was because he wants to stop a lawsuit in London against one of his business partners. Also, Yusupov is trying to stop a process that could dilute his business partner's shares in the bank that ties all this together.

Text by Mikhail Zelensky, translation by Kevin Rothrock

Photo on front page: Ramil Sitdikov / Sputnik / LETA

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