Even Russia’s ‘wildest capitalism’ was better than Credit Suisse’s conduct, billionaire says
Bidzina Ivanishvili is testifying in pursuit of Credit Suisse for hundreds of millions of dollars he lost to fraud
A Georgian billionaire pursuing Credit Suisse across the world for hundreds of millions of dollars he lost to fraud, said his treatment by the bank was worse than anything he saw in the freewheeling days of finance in post-Soviet Russia.
Bidzina Ivanishvili was testifying in a Bermuda court through a translator via a weblink from Georgia in his first public remarks about the case since an interview with Bloomberg in late 2019.
“Such rudities that I experienced in my relations with Credit Suisse, I never encountered even in the conditions of the wildest capitalism in Russia and Georgia after the breakup of the Soviet Union,” said Ivanishvili. “I’ve never seen the customer treated as badly anywhere else. It was shock on a scale that changed my world view.”
A former prime minister of Georgia, Ivanishvili is suing Credit Suisse Life (Bermuda) for failing to stop rogue banker Patrice Lescaudron from losing $400m of his fortune when, he says, clues about his crimes had become apparent. The Bermuda case is key, both because it could pave the way for others in Singapore and New Zealand where Ivanishvili also sued Credit Suisse, and because his lawyers say it’s where he lost close to half the money he invested with the bank.
Ivanishvili is one of at least five clients that continues to pursue the bank for damages despite Lescaudron’s conviction in 2018, refusing to accept that the bank had no knowledge of Lescaudron’s crimes. Lescaudron, who took his own life in 2020, was a lone wolf who hid his misdeeds from colleagues and superiors, the Zurich-based bank has consistently said.
Credit Suisse said before the trial it wouldn’t comment with the legal proceedings ongoing. It didn’t immediately respond to request for a reaction to Ivanishvili’s testimony.
The opening morning of Ivanishvili’s testimony included testy exchanges between the Georgian and the bank unit’s lawyer, Stephen Moverley Smith. On Tuesday, Moverley Smith described Ivanishvili as an “oligarch” who should bear more responsibility for the losses on some of the riskier investments Lescaudron made on his behalf.
Moverley Smith spent 90 minutes repeatedly challenging Ivanishvili, given his past experience in Russian banking, to characterise himself as a savvy investor with a sophisticated knowledge of financial markets. Ivanishvili responded by putting his banking experience in the context of how he felt he was treated by Credit Suisse.
“In the whole of my time working with banks, or in banks or owning banks, I never seen anything like what happened at Credit Suisse,” Ivanishvili said. “Even being a banker myself, I’ve never seen anything so shocking.”
The London lawyer then asked Ivanishvili why he’d answered one of his questions before it was translated into Georgian. Ivanishvili said he wasn’t hiding anything, had a basic knowledge of English for travel and simple conversations, but was still answering the previous question.
Asked why he chose to invest more than $1bn with a bank he’d never dealt with before and that had approached him rather than the other way round, Ivanishvili said it came down to a matter of trust and reputation.
“Because of the brand, it’s a brand name emanating trust,” Ivanishvili testified, recalling his motivations back then. “We even shied away from questions,” he said because he recalled he thought it would be embarrassing to ask too many.
Ivanishvili is due to continue testifying Thursday morning before his business adviser takes the stand on Thursday afternoon and Friday. Senior CS Life executives testify next week.
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