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Russian oligarch files service violation lawsuit against Finnish banks

Three banks in Finland confirm that Boris Rotenberg has started legal proceedings for what he claims are violations of service agreements due to US sanctions.

Helsingin käräjäoikeus ulkoa.
The Helsinki District Court building Image: Henrietta Hassinen / Yle

The Finnish branches of the banking chains Nordea, Danske Bank and Svenska Handelsbanken confirmed news from the Bloomberg Law news service on Friday that said Russian oligarch Boris Rotenberg has filed a lawsuit against them.

The close confidant of Russian President Vladimir Putin has filed a suit at the Helsinki District Court directed at Nordea, Danske Bank, Handelsbanken and Finland's OP Corporate Bank for violations of service agreements as a result of US sanctions imposed on him in 2014.

STT news agency efforts to reach OP for comment have been unsuccessful, but the three banks that confirmed the lawsuit were reluctant to say anything more about the case.

"We cannot comment on information about private customers," Handelsbanken's communications director Pirjetta Soikkeli told STT, saying that her bank first heard of the lawsuit on Friday.

"Danske Bank takes any efforts to prevent money laundering and the sanctions associated with these efforts very seriously. We have taken many significant steps to ensure that our activities comply with the regulations," Danske Bank's chief press officer Josi Tikkanen said.

US sanctions date back to 2014 annexation of Crimea

Boris Rotenberg is not a target of EU sanctions at present, but the US government blacklisted him and other close friends of the Russian president in 2014 after the Crimean crisis.

Nordea’s chief risk officer, Julie Galbo, spoke with the US news service Bloomberg in an earlier 19 October article about the difficult situation that many European banks have found themselves in when dealing with US-sanctioned individuals.

"We have a clear legal basis to block payments and exit customers based on the EU sanctions regulation," Galbo told Bloomberg. "We don’t have a legal basis when it comes to US sanctions, and there we are sometimes caught in a bind."

The bank nevertheless is forced to comply with US sanctions since it needs to work with US banks as part of the regular global flow of payments and capital.

"This exposes us to lawsuits, because we may de facto end up in situations where we block payments from a customer because we know that our counterparties aren’t going to accept those payments," she said.

Good friend of Putin's also holds Finnish passport

Boris Rotenberg was born in Leningrad in 1957, and also holds a Finnish passport.

He and his brother Arkady founded SGM, the largest construction company for gas pipelines and electrical power supply lines in Russia. In 2001, the Rotenberg brothers also established the SMP bank, which has over 100 branches in 40 Russian cities. In 2016, he was listed by Forbes magazine as Russia's 69th wealthiest person, with a net worth of close to one billion euros.

Bloomberg Law reports that Rotenberg filed the suit with the Helsinki District Court on 4 October.

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