Credit Suisse Client Says She Lost $50 Million in Banker’s Fraud
(Bloomberg) -- A Russian client of convicted former Credit Suisse Group AG wealth manager Patrice Lescaudron lashed out at the lender for putting itself before clients and accused Swiss prosecutors of rushing their indictment.
Returning to the courtroom where she testified almost a year ago, businesswoman Olga Korbatova said she lost 50 million Swiss francs ($50 million) and had her investment accounts frozen. Meanwhile, she said, the bank made about $150 million in commissions and other fees from Lescaudron’s illegal trades.
She also said the indictment wrongly dates the start of Lescaudron’s losses to the 2008 financial crisis. He started to cheat far earlier with trades in small-cap stocks like Meinl European Land that backfired, she said.
“If they had told me in 2007 that the bank already had ties to criminal enterprises like Meinl, I would have immediately cut my ties with the bank and wouldn’t have lost this 50 million,” said Korbatova, 54, who made her fortune from a Russian soft-drinks business.
Korbatova spoke a day after Lescaudron gave an account of the health problems that ensued after he was sentenced to serve a five-year prison sentence in February. The 55-year-old Frenchman was released in November, earlier than expected, following his conviction for faking trades and other transactions as he tried to recover the losses he’d incurred with bad stock bets.
The case has proved embarrassing for the Zurich-based bank, which nonetheless has maintained throughout the three-year-old case that it knew nothing of Lescaudron’s deception and it was as much the victim as Korbatova and his other clients.
Vincent Jeanneret, a lawyer for Credit Suisse, didn’t immediately address Korbatova’s money claims and a spokeswoman for the bank declined to comment.
The appeals this week were intended to resolve the thorny issue of who owes money and whom they owe it to, while lawyers for Lescaudron’s clients failed in an attempt to have the whole investigation reopened.
Korbatova said a discussion of compensation is premature and that her legal team is continuing to investigate the nature of some of Lescaudron’s investments in the U.S.
“Why are we talking about reimbursement when we haven’t finished looking at where the money disappeared?”
Jeanneret, later in his prepared remarks, rebutted the notion proceedings were rushed. Given the complexity of the case, Geneva prosecutors were wise to focus on the most severe aspects of Lescaudron’s deception which led to a rapid prosecution of the Frenchman, said the lawyer. But the trial was thorough with the presiding judge producing a 200-page verdict in Lescaudron’s conviction, said Jeanneret.
“It’s not every day you see that,” he said.
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