The CreditTrust was unlicensed, June 24. Several days before, it surprisingly ceded high-liquidity bills of the Gasprom, the Alfa Bank, the Bank of Moscow and certain other steady mammoths to exchange them into very dubious securities. June 15 found the CreditTrust with a 4.6 billion rouble creditor indebtedness, roughly US$150 million, with assets exceeding 6.8 billion roubles-of which the tarnished bills made 5.6 billion roubles, so the bank could not pay its debts. Evidently, CreditTrust assets had been removed through fraud. It owed its insolvency to managers' underhand deals, though it ascribed its plight to bad tensions that obsessed Russian banking at the time.
The Moscow Arbitration Court announced CreditTrust bankruptcy, August 11.
If bank bosses are really guilty of abuse of office, they may be convicted for up to five years each.
"The investigation will comply with the law to a T. I can't say just how long it may take-it depends on how obstinate the suspects will be in their pleads of innocence," says Gennadi Melnik, Interior Ministry investigation board chief of PR.
The prosecution has approved the opened proceedings, and they base on a file the Central Bank forwarded to law enforcement agencies, August 12-the day after the CreditTrust was announced bankrupt.
The bank had every formal right to make its controversial deal, point out many experts. However, a clause of the Russian Criminal Code stipulates corporate managers liability for damaging their company. Now, if CreditTrust stockholders tell the investigators they approved the fatal transaction, the case will tumble as a house of cards.
Whatever turn the matter may take, it will not affect the terms of deposits restored to bank clients, reassure analysts. The CreditTrust had only a negligible number of private depositors-good luck!
On today's resolution, the Central Bank is tomorrow terminating CreditTrust assignee activities to appoint a receiver in compliance with the federal law, Central Bank PR said to Novosti.
