Dec. 21 (Bloomberg) -- AO Alliance Bank, the first Kazakh lender to default in 2009, vowed to continue with its pursuit of damages from the former management team after a U.K. appeals court ruled that the bank’s case was beyond its jurisdiction.
“Alliance Bank will continue to seek recovery of the damages caused as a result of the defendants’ actions both on the territory of Kazakhstan and abroad regardless where their assets are located,” the Almaty-based lender said in a statement e-mailed today.
The bank defaulted in April 2009 after government-appointed managers found $1.1 billion of liabilities that weren’t reflected on its balance sheet. Kazakh authorities arrested or issued warrants for seven executives at the time, including the former chairman and co-owner Margulan Seisembayev and former Chief Executive Officer Zhomart Yertayev.
The U.K. court dismissed the bank’s appeal on Dec. 12, saying “Alliance had not established that the English court is clearly and distinctly the most appropriate forum for the resolution of the disputes.” The judge also ruled that the worldwide freezing order “should now be set aside, subject to any argument concerning its continuation pending a possible further appeal.”
Seisembayev, whose whereabouts are unknown, couldn’t be reached for comment. He has said the money he and other executives are accused of stealing was invested to support Alliance.
Yertayev declined to comment today, saying by phone that he considers his court involvement with the bank to be “completed.”
The defendants “consider the decision an important step in establishing the truth in the case around Alliance Bank and believe the court put a full stop in the proceedings,” Interfax quoted Seisembayev as saying in a Dec. 19 statement.
Courts in countries including Switzerland, Lichtenstein and the United Arab Emirates have dismissed accusations and halted proceedings against the bank’s former management, the Russian news service reported, citing the statement.
In March, a Kazakh court overturned a ruling that awarded Alliance 177.5 billion tenge ($1.2 billion) in damages from its former management. While the court in the financial capital of Almaty struck down the damages ruling, it upheld a conditional prison sentence of two years and a 378,000 tenge fine for both Seisembayev and Yertayev.
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