Mint's assets tightly sealed by British court

Igor Mints was not able to unlock his property. Otkrytie and Trust consider Boris Mints and his sons to be scammers and demand more than $ 700 million from them.
07.02.2020
RBC
Origin source
The High Court of London considered the statement of Igor Mints about the cancellation of the blocking of his assets and upheld the obligation to non-alienation of property within $ 572 million. RBC got acquainted with the court decision. The plaintiffs in the case against Mintsev are Otkrytie Bank and Non-core Assets Bank Trust. Igor Mintz also asked for the blocking of his stake in the management company EG Capital Advisors (which manages the assets of the MF Trust family trust) and his rights as a trustee of the family fund.

The judge in his decision concluded that the plaintiffs had grounds for accusing the defendants of fraud, and also pointed out that in the summer another judge recorded the risk of hiding assets. He also noted that Igor Mints, as the trustee of the family MF Trust, can manage the distribution of assets in favor of others. Igor Mints objected that he could only do what the trusts indicated to him (a person representing the interests of the beneficiaries of the trust. - RBC). There is no risk of hiding assets, he said.

“This decision once again confirms our innocence in this dispute. The judge made it clear that he considered it highly likely that this scenario would be hidden if assets were unblocked. We intend to prevent this and return the withdrawn money, ”said Alexander Sokolov, chairman of the bank’s board, whose words were conveyed by the Trust press service.

RBC sent a request to Stephenson Harwood, representing the interests of Igor Mints.

In June 2019, Trust and Otkritie, which the Central Bank owns through the Banking Consolidation Fund, filed a lawsuit against Boris Mints, the owner of O1 Group. The defendants are also the eldest son of Boris Mints, Dmitry and the two youngest sons, the twins Alexander and Igor. Then the court froze the assets of businessmen around the world in the range of $ 572 million.

In July, Boris, Dmitry and Alexander Mintsy tried to challenge this decision, but their lawyers spoke “without evidence”, it follows from the decision of the High Court of London. Then they managed to achieve only milder security measures: the court replaced the freezing of assets (WFO) with a commitment to undertaking their non-exclusion (undertaking). WFO is an injunction that implies a ban not only on disposals, but also on the disposal of assets.

Igor Mintz’s lawyer at the time of the court session said that if asset freezing around the world could not be removed right now, he would take the time to prepare a “full statement with evidence”. As a result, hearings on his statement were held in December.

However, the court again refused. The representative of the Trust claims that now the defendants will be able to challenge the obligation to non-alienation of property only if there is a significant change in the actual circumstances of the case.

What assets were blocked

Open Media, citing a court decision, wrote that the High Court blocked eight companies in the UK from Mintsev, including firms that own the Elstree Moat House Hotel and Stoke-on-Trenton House Hotel, Bolton Moat House and DoubleTree by Hilton Cheltenham, as well as Summerwinds, Montague House and Lethendy Tower. The ultimate beneficiary of Lethendy is Boris Mints's Mints Family Trust, wrote RBC in 2018. All hotels and Lethendy itself are mortgaged to banks, according to documents from the British company registry.

In addition, about 100 companies registered in Cyprus, Luxembourg, the Cayman Islands and the British Virgin Islands, as well as accounts with foreign banks, were arrested.

State Bank Claims

Trust and Otkrytie accused Boris Mints and his sons of fraud and demand more than $ 700 million from businessmen. The subject of the proceedings were transactions that the O1 Group conducted in the summer of 2017 with Otkritie Bank (controlled by Vadim Belyaev) and Rost-Bank ( controlled by Binbank Mikail Shishkhanov). In the summer, Otkritie and Rost-Bank bought bonds of the OV Group Finance SPV company for 57 billion rubles. At the end of August-September 2017, the Central Bank took first “Opening” along with “Trust” for reorganization, and then Binbank along with Rost-Bank. The new owners tried to expand the transaction, as the money earned from the sale of bonds was allocated by O1 Group to repay their own loans in Otkrytie ($ 500 million) and Rost-bank ($ 350 million). Under these loans, Cypriot companies O1 Group Centimilia and Nori, as well as Coniston (BVI) of Alexander Nesis, pledged shares of O1 Properties, which owns Class A offices in Moscow. The plaintiffs suggest that the Mintsev family knew about the financial difficulties of banks and carried out an “illegal” release of collateral through transactions with bonds.

“It was not a simple operation to replace loans with bonds. Transactions meant the movement of large sums of money through an intricate network of companies so that it was not obvious that the money of the banks was used to repay loans, ”the judge argued with the plaintiffs.

Bonds of O1 Group Finance with maturity in 2032 and with small coupon payments were called by the employees of Otkrytie “bullshit” and “garbage,” Forbes reported. According to the plaintiffs, the only person in the bank who supported their acquisition was Yevgeny Dankevich, the ex-management of Otkrytie.

Criminal claims

The O1 Group Finance bond transaction became the basis of a criminal case on embezzlement of 34 billion rubles. from the bank "Discovery". Boris Mints, his sons Dmitry and Alexander, as well as the former Discovery management Evgeny Dankevich, are walking along it, the last three have been arrested in absentia. All the persons involved in the case are located outside of Russia: the Mintsev family in the UK, Dankevich in Israel.

What does the Mintz family answer

The former co-owner of Otkrytie Belyaev himself asked the O1 Group for help with liquidity, since the bank was in a difficult financial situation in the summer of 2017, Boris Mints told the court. He claimed that he was not immersed in the details of the transaction.

The sons of Boris Mints, Dmitry and Alexander, in their position for the court, noted that they considered the purchase of bonds by banks to be economically feasible. The bonds replaced loans that could require additional provisioning, were sufficiently secured and were issued to companies without “going out” to the O1 Group head office.

In addition, bonds could be used for repurchase transactions and attracting short-term liquidity. According to the plaintiffs, the bonds were issued on such “non-market” conditions that it was hard to believe that they were able to generate cash flows. At the same time, only 5% of the issue was used for repo transactions.

The sons of Mints noted that the bonds provided for greater returns than loans, and in the case of Otkrytie, they suggested the possibility of redemption by the co-owner of Otkritie Holding Bank. The holding agreed to redeem bonds from Otkritie’s balance sheet at an increased price on December 22, 2017. O1 Group itself was also ready to improve conditions (raise the rate) and redeem bonds in November 2017 if the Moscow Exchange would not agree on a change in the terms of the issue.

Finally, the defendants draw attention to the fact that none of the bank’s employees complained to the Central Bank about the actions of the bank’s management, and the regulator’s representatives attended all the committees.

"Personal animosity"

The Mintsev family considers the lawsuits themselves to be part of a campaign to put pressure on them, initiated by the leadership of the Central Bank and the heads of Discovery and Trust Mikhail Zadornov and Alexander Sokolov, including due to "personal hostility." Boris Mintz accused his opponents of “abuse of litigation” and failure to fulfill obligations, which ultimately led to their loss from $ 650 million to $ 950 million.

In particular, according to Mintz, due to the Central Bank’s campaign and Otkrytie, the O1 Group as a result was unable to pay with the Moscow Credit Bank (MKB), which had been pledged shares of O1 Properties and the Future financial group. MKB first ceded its debts to its shareholder, the Rossium concern Roman Avdeev, and he transferred it to Riverstretch Trading & Investments (RT&I) (its largest shareholder is the former top manager of Region Group, Pavel Vashchenko). As a result, RT&I took away the assets of O1 Group for debts.

In an interview with Vedomosti, Zadornov said that he considered Mintz’s position “fantastic.” “My colleagues and I inherited this situation and will bring it to its logical conclusion. There is nothing and cannot be anything personal - just the facts, ”he emphasized.

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