By Ivan Anderzhanov in Mosow
Russia has agreed to drop money-laundering charges and a $22bn lawsuit against US lender Bank of New York Mellon in return for a miserly $14m.
Russia and the US bank agreed “to sign a friendly agreement” by which the bank will make the payment to Russian customs authorities.
As part of the deal, the bank will also offer Russia a loan at a preferential rate as “a gesture of good will, confirming its willingness to work with Russia.”
Russian customs launched legal proceedings in 2007 claiming $22 bn from the bank, reigniting a case dating back to the 1990s.
The Bank of New York, which in July merged with Mellon Financial Corporation, was investigated by US and Russian authorities on suspicion of letting two Russians launder billions of dollars through one of its accounts.
Finance Minister Alexei Kudrin said on Wednesday that this had not been proved.
Russia filed a $22.5bn lawsuit in May 2007 against the Bank of New York, America’s oldest financial institution, for money laundering which allegedly took place towards the end of the 1990s.
Two Russian-born American residents, former BNY vice president Lucy Edwards and her husband Peter Berlin, opened the account in 1996, allegedly allowing billions of dollars in funds to be channelled out of Russia without paying taxes.
The investigation prompted a storm of media coverage and a series of related money-laundering probes worldwide.
In 2000, Swiss authorities targeted the bank in an investigation into the suspected embezzlement of a $4.8 billion International Monetary Fund loan to Russia via Bank of New York accounts.
At the time, the bank issued a strongly-worded statement rejecting the new case. It said: “It should be noted that the events related to the lawsuit occurred more than 10 years ago and were previously resolved by the company.”
The bank agreed to pay $38m to settle the case in a US court in November 2005, including $12m dollars in compensation to victims and a fine of $26m.
Berlin and Edwards pleaded guilty to conspiracy to commit money laundering and other crimes, and were sentenced in July 2006 to six months of house arrest and fines totalling $725,000.
