MOSCOW, December 30 (RAPSI) – Russia’s Deposit Insurance Agency (DIA) representing Vneshprombank, a major mid-sized bank that slid into bankruptcy, has filed a motion with a U.S. court seeking to recognize the bank’s pending insolvency proceeding in Russia as a “foreign main proceeding” prioritizing it over a bankruptcy claim against the bank currently being reviewed in U.S., according to the DIA’s statement published on its website.
On December 18, 2015, the Central Bank appointed a temporary administration in the bank for six months to appraise its financial performance. In March 2016, the Moscow Commercial Court declared Vneshprombank bankrupt. It was revealed that massive transactions had been conducted to transfer assets out of the bank. A criminal case was opened against former co-owner of the bank Larisa Markus on fraud charges. She was arrested in December 2015. Her brother, another co-owner of the bank, Georgy Bedzhamov was put on the wanted list.
Allegedly Markus, along with her unidentified accomplices, granted loans to sub-companies in New York known as New York LLCs and did not refund money to Vneshprombank. On March 22, 2016, Panabroker Protecting and Indemnity Association, S.A., a company from Panama, commenced proceedings against the bank and New York LLCs in the New York court.
DIA asked the United States Bankruptcy Court for the Southern District of New York to recognize the Agency as the foreign representative of Vneshprombank and permanently “enjoin all parties from commencing or taking any action in the United States to obtain possession of, exercise control over, or assert claims against the Debtor or its property.”
The Agency provided its arguments for why, in accordance with U.S. legislation, the Bankruptcy Code in particular, proceedings in Russia, the main base of operations for Vneshprombank, should be prioritized. It noted that those qualify as “foreign proceedings” and DIA itself qualifies as representative of Vneshprombank under the ruling of a Russian court. In addition, DIA believes petition, filed with the Unites States court, to meet the requirements of 11 U.S.C. § 1515 of the Bankruptcy Code.
The first hearing in this case is set for January 31, 2017.