The Moscow City Court on Monday upheld a lower court’s decision to extend house arrest until July 14 for U.S. investor Michael Calvey, who is charged with 2.5-billion-ruble (about $40 million) embezzlement, TASS reports citing the court’s press service.
Calvey, a prominent investor and founder of investment company Baring Vostok, was released from detention and put under house arrest. The measure was later extended for three months.
In mid-February, Moscow’s Basmanny District Court ordered the detention of Calvey and five other defendants including Baring Vostok Industry Partner for the financial industry sector, French citizen Philippe Delpal, the company’s partners Vagan Abgaryan, Baring Vostok Investment Director Ivan Zyuzin, Maxim Vladimirov and ex- chairman of Vostochny bank board Alexey Kordichev until April 13.
According to the investigation, Calvey knew about a 2.5-billion-ruble debt of the First Collector Bureau, a firm under his control, and still organized the sale of its shares to Vostochny Bank that has led to embezzlement.
The Russian Investigative Committee claims that the defendant committed a crime that could not be classified as business crime because he used a chain of sham companies settling the deal. Moreover, investigators say they have a PricewaterhouseCoopers’ audit report on the done deal estimating the sold shares at 600,000 rubles, which indicates an instance of fraud.
Calvey denies allegations insisting that the deal was fair as both companies agreed its terms and stood for it, including a person reporting an alleged crime to law enforcement bodies. According to the American investor, the real reason for his prosecution is a wide corporate dispute related to the control of the bank by two groups of shareholders: Baring Vostok and stockholders coming from Uniastrum Bank, which was reorganized and joined to Vostochny in early 2017.