Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Russia detains U.S. founder of Baring Vostok private equity group

World Feb 15, 2019 08:55AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Michael Calvey, senior partner at Baring Vostok, attends a session of the St. Petersburg International Economic Forum

By Maria Vasilyeva and Katya Golubkova

MOSCOW (Reuters) - Russia has detained the U.S. founder of the Baring Vostok private equity group in Moscow on suspicion of fraud, a Moscow court said on Friday, a move likely to concern foreign investors.

Michael Calvey, a U.S. national and senior partner at the fund, was detained on Thursday, a spokeswoman for Moscow's Basmanny court said.

Calvey was not available for immediate comment. The court ordered one of the executives, Phillipe Delpal, a French national, to be held in custody.

The detentions come at the same time that Russia is hosting a major investment forum in the Black Sea resort of Sochi intended to attract foreign investors, many of whom stopped pumping in new money when the West imposed sanctions on Moscow for its actions in Ukraine.

In the past few years, Russian law enforcement has mounted cases involving the businesses of billionaire entrepreneur Mikhail Prokhorov, Vladimir Yevtushenkov and Ziyavudin Magomedov. Officials have denied the cases are politically-motivated, but some people in business circles say they have had a chilling effect on the business climate.

Kirill Dmitriev, the head of Russia's sovereign wealth fund said he knew Calvey and his team as professional investors and would personally vouch for Calvey. Dmitriev is an influential member of President Vladimir Putin's ruling circle.

Putin was not aware of Calvey's detention, the Interfax news agency cited the Kremlin as saying.

Bill Browder, chief executive of Hermitage Capital and an outspoken Kremlin critic, said that Calvey's arrest showed that Russia was an "uninvestable country".

"Of all the people I knew in Moscow, Mike played by their rules, kept his head down and never criticized the government."

If found guilty, Calvey and the other suspects face up to 10 years in jail. Before starting Baring Vostok, Calvey worked for the European Bank for Reconstruction and Development and Salomon Brothers.

Baring Vostok is a major equity fund group in Russia and its website says it has over $3.7 billion of committed capital.

A state prosecutor said Calvey and other executives at his fund were suspected of embezzling 2.5 billion rubles ($37.48 million) by persuading shareholders in a Russian bank to accept a stake in another firm at an inflated price.

The alleged share scam occurred in 2017 and involved Vostochny Bank, a small lender in which Baring Vostok has a controlling stake. It concerned the transfer of equity in Luxembourg-based Financial Technology Group, the Moscow court heard.

Baring Vostok, which described the case as a commercial dispute, said it was not directly linked to its activities or its funds and that it was continuing to operate as normal.

Vostochny Bank said it was cooperating with the authorities and was hoping that the losses it had incurred as part of the share deal would be reimbursed.

Russia detains U.S. founder of Baring Vostok private equity group
 

Related Articles

Nancy Pelosi takes communion at papal Mass in Vatican
Nancy Pelosi takes communion at papal Mass in Vatican By Reuters - Jun 29, 2022

By Philip Pullella VATICAN CITY (Reuters) -Nancy Pelosi, the speaker of the U.S. House of Representatives who is banned from receiving communion in her home city of San Francisco...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email