Lawyer declares exclusion of Surkis family funds in PrivatBank from bail-in procedure

KYIV. Nov 1 (Interfax-Ukraine) – The statements about the alleged write-off of funds of the Surkis family companies on accounts in PrivatBank as part of the bail-in procedure during its nationalization are refuted by the group’s annual financial statements for 2020, and the additional purity of these funds is confirmed by the American company Alvarez & Marsal, Ihor Surkis’ lawyer Ihor Alekseyev said.

"As of December 31, 2020, about UAH 8.1 billion of funds from clients of the Cyprus branch of PrivatBank, which were the subject of conversion into capital during the nationalization of 2016, that is, were the subject of a write-off, were included in the term deposits of legal entities. These funds were not transferred by the bank’s branch because of the ban of the Central Bank of Cyprus on the branch’s conducting interbank settlements with the bank and because of the lawsuits opened on these funds," he cites the document in materials transmitted to the Interfax-Ukraine agency.

According to the lawyer, the statements of PrivatBank representatives and their legal advisers that the funds of depositors in Cyprus were written off to the bank’s capital and that such funds do not exist now are unfounded.

Alekseyev also said that the purity of deposits of the British companies of the Surkis family in PrivatBank was confirmed by the international consulting company Alvarez & Marsal.

In the report of the American company on its website, dated June 23 this year, it is indicated that, as part of a dispute with the Ukrainian bank, a group of British companies attracted A&M in 2021 with the task of analyzing the movement of funds across dozens of accounts and determining whether there was a cyclical use of loans, what the group was accused of.

"In general, the movement in the amount of more than $ 350 million was analyzed by A&M, including at least $ 9.7 million of earned interest. A&M managed to determine that there were no typical signs of loan reuse," the company’s website says after such a forensic audit in different regions.

It clarified that the process involved verifying invoices in detail, matching receipts with payments, and where matching was not possible in this way, applying a first-in-first-out approach to track amounts until they were first received. In addition, particularly large or exceptional purchases were identified, and other tranches were randomly selected for more detailed testing, assessing whether any funds were used for personal purchases.