Russian Billionaire Loses Lawsuit Against Nordic Banks

© Reuters.  Russian Billionaire Loses Lawsuit Against Nordic Banks © Reuters. Russian Billionaire Loses Lawsuit Against Nordic Banks

(Bloomberg) — A group of Nordic banks sued by a Russian oligarch aren’t required to accept his business, according to what may prove to be a landmark ruling by a court in Finland.

Russian billionaire Boris Rotenberg, an associate of President Vladimir Putin, lost his lawsuit against four Nordic banks and was ordered to pay more than 500,000 euros ($ 556,000) to cover their legal fees, the Helsinki District Court ruled on Monday.

The court said that forcing the banks to accept business from Rotenberg, who is on the U.S. sanctions list, would have subjected them to significant financial risk which they, by law, are prohibited from taking.

The lawsuit targeted Svenska Handelsbanken AB (ST:) for refusing to accept cross-border deposits from Rotenberg, and Nordea Bank Abp (SIX:), OP Group and Danske Bank A/S (CSE:) for not processing payments to vendors for basics including Rotenberg’s electricity bills.

Jakob Dedenroth Bernhoft, a Copenhagen-based lawyer who specializes in compliance and money laundering issues, said the decision would set an important precedent.

“All the other banks will look at this decision from the court for guidance on what to do in a similar situation,” Bernhoft said by phone before the verdict was delivered.

At stake was the banks’ access to the U.S. dollar market, which is crucial to their ability to operate.

The case comes against a backdrop of money-laundering scandals in the region, with regulators ratcheting up compliance requirements. Banks are also under increasing pressure to identify dodgy customers. According to documents provided to the court, Rotenberg has a current account at Handelsbanken, which the bank has supplied on the recommendation of the Finnish Financial Ombudsman Bureau.

Rotenberg had argued that his status as a dual citizen of both Russia and Finland meant that banks based in Europe must process his transactions. But the court said Rotenberg failed to prove he resides in a European Economic Area country, and thus has no such rights to basic banking services as mandated by law.

The court’s panel of judges ruled unanimously, but the verdict can be appealed. Rotenberg has seven days to express his dissatisfaction with the ruling, the court said.

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Lawsuit over faulty background check allowed to proceed

Shooting victims’ families on forgiveness

A lawsuit over a faulty background check that allowed a South Carolina man to buy the gun he used to kill nine people at AME Emanuel Church in Charleston was reinstated Friday by a federal appeals court. The three-judge panel reversed a ruling from a lower court judge who threw out the claims brought by relatives of people killed by Dylann Roof in the 2015 massacre and by survivors.

The 4th Circuit panel found that an examiner who conducted the background check on Roof failed to follow a mandatory procedure when she did not contact the arresting agency.

The ruling means the lawsuit can move forward.

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The FBI acknowledged that Roof’s drug possession arrest in Columbia, South Carolina — weeks before the shooting — should have prevented him from buying a gun. Roof has been sentenced to death for the slayings.

A series of clerical errors and missteps allowed Roof to buy the handgun he later used in the massacre.

In his ruling last year, U.S. District Judge Richard Gergel said a jail clerk wrongly listed the Lexington County Sheriff’s Office as the arresting agency in the drug case. The examiner then sent a fax to the sheriff’s office, which responded that it did not have the arrest report and directed her to Columbia police.

Gergel said that under the system’s operating procedures, the examiner was directed to a federal listing of law enforcement agencies, but Columbia police did not appear on the list. After trying the separate West Columbia Police Department and being told it was the wrong agency, the examiner did nothing more.

After a three-day waiting period, Roof went back to a West Columbia store to pick up the handgun.

A spokeswoman for the U.S. Department of Justice declined to comment on the ruling.

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