Banks, Crime, Financial Services, Latvia, Legislation, Lithuania, Loan, Russia

In one of these cases Latvijas Krajbanka granted a loan to the Cyprus-based company Plazmexon Investments Limited (Plazmexon) for the purchase the yacht Highlander. In connection with this loan, the plaintiffs are demanding nearly 2 mln euros from the defendants - Ivars Prieditis, Martins Bondars, Dzintars Pelcbergs, Martins Zalans, Andrejs Surmacs, Ilze Bagatska and Svetlana Ovcinnikova.

The other loan had been extended in relation to a real estate development project in St. Petersburg, Russia. The plaintiffs are demanding 13 mln euros for the losses they allegedly suffered from this deal.

The court hearing is still in progress.

As reported, on November 21, 2011, the Latvian banking regulator decided to suspend Latvijas Krajbanka from provision of all financial services. The decision was made after it was discovered that around 100 mln lats (142 mln euros) had disappeared from the bank. The State Police launched a criminal procedure over the situation at Latvijas Krajbanka.

The Riga Regional Court declared Latvijas Krajbanka insolvent on December 23, 2011, and the bankruptcy procedure in respect of the bank was announced on May 8, 2012.