Investments in BermudaHis financial advice made him lose $553 million
The billionaire and former Prime Minister of Georgia, Bidzina Ivanishvili, suffered a shortfall of 553 million dollars, due to the mismanagement of his financial advisor.
Georgian billionaire and former Prime Minister Bidzina Ivanishvili suffered a $553 million deficit in investments made through a Credit Suisse subsidiary in Bermuda due to the financial adviser’s mismanagement, a judge ruled Tuesday. The damages that Credit Suisse Life Bermuda must pay for “breach of contract and misrepresentation” have yet to be calculated by accounting experts, Bermuda Supreme Court Justice Narinder Hargun said in his ruling.
Credit Suisse, currently rocked by numerous scandals, has announced its intention to appeal. The number two in the Swiss banking sector had warned last week that it would soon be subject to a judgment for more than 500 million dollars and that it had built up reserves to deal with it. The branch in question “has been in liquidation for more than seven years and has no other significant activity that will be affected by this sentence”, the bank specified on Tuesday in a press release.
The judge believes that he acted fraudulently
Bidzina Ivanichvili had filed a complaint, believing that his investments would have brought much more money if he had not been “diverted or invested in an imprudent way”, recalls the judge in his decision. The latter accepted an assessment of the losses proposed by an accountant appointed by the applicant, calculating the difference between the sums produced by the investments managed by Credit Suisse and those that the same investments could have generated in a medium-risk portfolio. .
At the heart of the case is the financial advisor Patrice Lescaudron. The judge considers that he acted fraudulently by making investment decisions without the required agreements, producing false documents or transferring funds to the accounts of other clients. Patrice Lescaudron was convicted by Swiss justice and sentenced in 2018 to five years in prison. He committed suicide in 2020.
The subsidiary of Credit Suisse for its part did not take the necessary measures to prevent the actions of the board “because it prioritized the income generated by Mr. Lescaudron on behalf of Credit Suisse over the interests of its customers”, estimates the judge. .