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In other words, it looks as if VP Bank had been involved in «fiduciary loans». Owners of Russian banks used such fiduciary loans in the 1990s and the first years of 2000 and were considered a grey area of business at the time.

But in the cases of bankrupcies, such transaction came to light and were the cause of heated debate – banking failures beset the Russian financial market at regular intervals at the time. In 2014 alone, no fewer than 86 banks had to be shut close.

No Provisions

Claimants have succeeded in making Russia the place of jurisdiction in both cases. And not only that: in one of the cases, an appeals court in May 2017 ordered VP Bank Switzerland to pay $10 million. As the bank refused to accept the decision, it didn't act upon the demand and took measures to protect its interests. VP Bank hadn't taken any provisions for the case in Russia.

The bank wrote in the six-month report 2018 that the bailiff had started an enforcement procedure against the representative office in Moscow on June 7, 2018. So, is there really no connection at all?

Attorney General Investigates Ex-Bureau Chief

The closure of the office has added another interesting chapter to its colorful history. In March 2018, Switzerland's «Handelszeitung» (in German only) wrote that the head of the Moscow office of Julius Baer may have been involved in an arms deal in Russia – adding that the attorney general was investigating. The Zurich-based bank has released the banker since.

The ex-bureau chief of Julius Baer isn't an unknown in Liechtenstein. He used to run the Moscow bureau of VP Bank and was at the center of controversy even at the time. For instance, a blog report claimed that a Russian business partner had been imprisoned for fraud. Asked whether the link to the two failed banks also went back to his tenure, VP Bank simply said he had left the bank in 2012.