The third highest-ranking official in Russia, the chair of Federation Council Valentina Matviyenko, will not be pleased that her name is mentioned in the UK Court of Appeal judgement delivered this week in a high-profile case alleging multimillion fraud by her associates in Russia.
Vitaly Arkhangelsky, the former owner of St Petersburg port and construction business, Oslo Marine Group (OMG), claims he lost hundreds of millions of dollars as a result of “fraudulent raiding” of his business by Bank St Petersburg and its chairman, Alexander Savelyev. OMG’s two terminals in the seaport of St Petersburg were sold at public auctions to repay OMG’s debts to the Bank following the 2009 financial crisis. It later transpired that the buyer companies and other bidders were all parts of the Renord-Invest Group, secretly controlled by Mr Savelyev. Dr Arkhangelsky claims that the sales were “collusive” and at “gross undervalue”.
Mr Savelyev is a personal friend and a former business associate of Mrs Matviyenko, who at that time was the Governor of St Petersburg. Dr Arkhangelsky alleges that Mrs Matviyenko and other “corrupt officials” abused their power to assist the “raiding” of OMG by fabricating criminal charges against him, and sending riot police to seize one of his seaport terminals.
Following a three-months trial, in 2018, the High Court judge Mr Justice Hildyard held that Dr Arkhangelsky failed to prove his allegations to the necessary standard, “bearing in mind the heavy onus of proof in the context of an assertion of dishonesty". Dr Arkhangelsky appealed to the Court of Appeal, the second highest court in the UK.
Following a four-day hearing in early March, this week the Chancellor of the High Court Sir Geoffrey Vos, Lord Justice Patten and Lord Justice Males have reversed the earlier decision and sent the case for a re-trial. The Court of Appeal has ruled that the “standard of proof” applied by Mr Justice Hildyard was “too high”, and highlighted a number of “crucial” findings which it deemed “unsafe”. In particular, the Court criticised the rejection of the evidence of “a conspiracy to raid involving Mrs Matvienko, [the head of St Petersburg’s police] Gen. Piotrovsky, and other "corrupt officials"”. The Court has set aside the decision of Mr Justice Hildyard and send the case for a re-trial before a different judge.
The re-trial is expected to take place later in 2020.
Full judgement of the Court of Appeal: https://www.bailii.org/ew/cases/EWCA/Civ/2020/408.html
Full judgement of the High Court: https://www.bailii.org/ew/cases/EWHC/Ch/2018/1077.html
V. Arkhangelsky’s press office
Natalia Khmelik email@example.com