Moscow court freezes USD1 billion in funds from US banks over MR Bank liquidation
Date
10/3/2024 8:32:46 AM
(MENAFN) The Moscow Region arbitration court on Wednesday ordered the freeze of funds held by two major U.S. banks, JP Morgan Chase and The bank of New York Mellon. The measure affects nearly 93.5 billion rubles (USD1 billion) in assets held by the institutions and their subsidiaries in Russia.
This interim decision follows a case filed by Russia’s Prosecutor General last month, marking the latest development in a series of legal actions related to the liquidation of the International Reserve Bank (MR Bank), a subsidiary of Russian major Sberbank, by Ukrainian authorities in early 2022.
At the time of its liquidation, MR Bank had nearly USD372 million held in the two U.S. banks, including approximately USD250 million with The Bank of New York and USD121.1 million with JP Morgan. The funds became inaccessible to Sberbank and its main shareholder, the Russian government, due to actions taken by Ukrainian authorities and U.S. financial sanctions, according to the prosecution.
The Prosecutor General requested the court to arrest all funds held by the two U.S. banks at Citibank Russia, and ultimately to award Sberbank USD372 million in damages. The funds have been placed in so-called ‘Type S’ accounts, which Moscow introduced early in the Ukraine conflict as a countermeasure against Western sanctions. These restricted accounts are designed to prevent the movement of funds out of the country by entities from certain "unfriendly nations."
The Bank of New York Mellon was found to possess approximately USD66 million in its Type S accounts. Since the MR Bank’s lost funds are considered subject to joint liability, the prosecution argued that the remaining amount must be seized from JP Morgan.
MENAFN03102024000045016755ID1108743431
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.