Foreign Economic Industrial Bank Limited, "Vneshprombank" Ltd.
12/19/16 Recap:
Boring Bankruptcy Pro version: privately-held bank declared insolvent in Russia back in March files for Chapter 15 seeking 109 eligibility on the basis of a legal retainer held at Bank of America in New York and a lawsuit filed against the bank in the District Court for the Southern District of New York. The purpose of the filing is to leverage the "stay" and seek discovery of assets which may be located in the US.
Badass International Intrigue version: Wait, discovery of assets? What assets? Glad you asked. It appears that back in December 2015, the President and owner of the privately held bank, Ms. Larisa Markus was arrested on suspicion of "large scale" fraud after entering into lending agreements with affiliated companies with no intention to repay (see staggering debt number below). She apparently embezzled the funds with the assistance of her brother - who is on the run seeking asylum in Monaco - and parked the funds in New York-based LLCs which were then used to purchase condominium and cooperative apartments in New York City. No wonder (i) housing supply in NYC sucks and (ii) rents are too damn high. Clearly LLC regulations are warranted. And who the bloody hell was on those coop boards? PS. The missing funds are customer deposits and the bank currently only has RUB 3.3 billion to pay claims. 3.3/230 = no bueno. PPS. At least one of the properties has already been sold to a third-party. The proceeds? The whereabouts are unknown. Boom! Keri Russell is probably already gearing up for the adaptation.
Jurisdiction: S.D. of New York
Debt: RUB 230 billion
Company Professionals:
Legal: Blank Rome LLP (Rich Antonoff, Barry Seidel, Evan Zucker)
