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Asset protection: threats and solutions for Russian private clients. Ilya Aleshchev, Partner, Alimirzoev & Trofimov law firm, Moscow. What Dangers are for a Typical Russian Private Client?. Lives Globally. Key risk areas: Matrimonial disputes Inheritance Creditors Political risks .
Ilya Aleshchev, Partner, Alimirzoev & Trofimov law firm, Moscow
Can be a PEP
Foreign bank accounts
NB: Potanin’s wife Natalia was represented in her US discovery litigation by law firm Alston&Bird, who earlier assisted in obtaining US visa for Oleg Deripaska, Potanin’s rival in NorilskyNikel dispute
Challenge: coordination of multi-jurisdictional team of counsels to fight off unsubstantiated disclosure requests filed in many jurisdictions simultaneously
Challenge: Building the new corporate structure being recipient of business sale proceeds and yet formally unrelated to the Client
NB: If the proceedings have already started, try limiting wife’s access to the “real money” to prevent further discovery and litigation funding
NB: Yuri Abramyan, owner or an ice cream manufacturer, divorced his first wife in 2005 and remarried, but never separated marital property with the first wife. After his death in 2009, widow reportedly attempted to take control over the business, squeeze out deceased’s heirs and to strip assets
Challenge: Convincing Russian notary and state guardian authority on post death variation which is permitted under Russian law but used very rarely
Challenge: Protection of late patriarch’s family who are collectively the major shareholder but most members are passive and not involved into operational control
NB: Even relatives of deceased HNWIs can face cash flow issues when death is sudden and no arrangements were made. Easily accessible emergency cash reserve can resolve this.
NB:GlebFetisov, ex-owner of “My Bank “, sold the bank in December 2013, but reportedly sale was on nominal value due to bank’s poor financial position. Bank license was revoked in January 2014, and in February MrFetisov was arrested on charges of RUR 10B embezzlement from bank. RF Central Bank claims money were withdrawn from the bank as loans to sham companies before the sale
Challenge: Protection from very formal and rigid rules of RF insolvency legislation, imposing director’s liability for debtor company in full for failure to file insolvency application or transfer accounts to insolvency officer
Challenge: Review and analysis of complicated and entangled governance, decision and financing structure to reveal any grounds for operational partners’ personal liability for waste and embezzlement, locating his assets
NB: Delegate operational management , and if personally involved into decision making try not to leave paper track as shadow director concept is likely to be applied by Russian courts
Challenge: Weighting legal and political risks of involuntary receipt of shares and timeframe for disposing of the same
NB: Watchdog activism has increased in Russia over last few years, when activist reveal and publicly disclose undeclared property of state officials
Alimirzoev & Trofimov law firm, Moscow