(Bloomberg) — Billionaire Bidzina Ivanishvili, who sued a Bermuda division of Credit Suisse Group AG for banker fraud, suffered losses of $553 million, partly due to the negligence of the life insurance unit, a judge ruled.
Forensic accountants working on the case still have to calculate damages for Ivanishvili, Bermuda Supreme Court Chief Justice Narinder Hargun said Tuesday when he rendered his verdict against Credit Suisse Life Bermuda in Hamilton, the island nation's capital.
CS Life failed to take adequate measures to prevent the “fraudulent management of policy accounts by Patrice Lescaudron, because it prioritized the revenue Mr. Lescaudron generated for Credit Suisse over the interests of his clients,” Hargun said, referring to the banker who committed the crime.
“If Mr. Ivanishvili had known that fraudulent transactions had been made in his accounts with the bank, he would not have agreed to take” the policies with CS Life, the judge said.
Credit Suisse Life Bermuda “intends to vigorously file” an appeal of the verdict, the company said Tuesday in a statement. The Zurich-based bank said last week that it had already made reserves linked to the impending decision against Credit Suisse Life Bermuda, which could exceed US$500 million in damages.
Scammer
However, the magnitude of the sentence may encourage Ivanishvili and other victims of convicted fraudster Lescaudron to claim further civil damages in Singapore and Switzerland.
Major financial crime prosecutors in Geneva continue to investigate Credit Suisse for its possible responsibility for failing to arrest Lescaudron, which could result in criminal charges and trial.
Lescaudron was convicted of fraud by a Swiss court in 2018. Credit Suisse has said that the Frenchman, who took his own life, was a lone wolf hiding his fraudulent activity. The Bermuda trial was seen as proof of whether the argument will isolate the bank from future responsibilities.
The ruling is the latest in a long series of setbacks suffered by the Zurich-based company, which is recovering after the double blow of the bankruptcy of Greensill Capital and Archegos Capital.
Original Note:
Credit Suisse Client Lost Over $550 Million, Judge Rules (1)
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