Baltic States – CIS, Banks, EU – Baltic States, Financial Services, Latvia, Legislation, Lithuania

Vladimir Antonov and Raimondas Baranauskas used Switzerland-based banks HSBC Private Bank SA and Julius Baer & Co AG to transfer Snoras assets as collateral for loans to companies owned by or associated with Antonov, the lender said in a June 21 filing made public yesterday. Some of the loans weren't repaid and the securities were forfeited, it said.

Bankas Snoras, once Lithuania's third-biggest lender by deposits, is suing its former owners for EUR 492 million. They were detained in London in November after Lithuanian authorities issued a European arrest warrant on claims they forged documents and fixed accounts to siphon at least LTL 1.7 billion ( USD 610 million) from Snoras, causing its collapse. Both men deny the claims and are fighting them.

Brendan McNamara, a spokesman for London-based HSBC Group Plc, and Kevin Gold, a lawyer from Mishcon de Reya in London representing the men, declined to comment on the lawsuit.

Antonov had the Vilnius-based bank's securities transferred to his personal account, using it to pay interest on a mortgage for a chalet in France, according to the claim. Antonov, who is Russian, says the case may be politically motivated and believes his life may be in danger if he returns. They are fighting their extradition in a pending London case.

The pair had companies domiciled in the Dominican Republic, Cayman Islands, Cyprus, Belize and the Bahamas to evade detection, according to the claim.

Antonov instructed Snoras to pay "excessive and commercially unjustifiable price" for properties in Riga, Latvia, from companies owned by or connected to him, losing the bank at least 17 million euros, according to the filing.

In one deal, Cyprus-based and Antonov-linked Bandiron Corporation Limited bought the headquarters of Latvijas Krajbanka AS from Red Projekts SIA for USD 10.6 million, then sold it three days later to Snoras for 23.2 million lati, the former Latvian currency, the claim said.