Swiss supreme court approves freeze of Russian government funds

24th January 2008, Comments 0 comments

The freezing of Russian central bank funds by Geneva prosecutors has been deemed within the law.

24 January 2008
LAUSANNE - Geneva prosecutors acted within the law when they froze funds belonging to the Russian central bank at the behest of a Swiss firm, the country's supreme court said Thursday.

The Swiss federal tribunal rejected an appeal by the Russian government against the provisional seizure in May of unspecified sums deposited in the Geneva branches of UBS, Credit Suisse and BNP Paribas.

The funds were frozen over a legal dispute with Geneva-based trading firm Noga dating back to the end of the Soviet era.

According to court documents, Noga owner Nessim Gaon is seeking to recover 1.185 billion Swiss francs (US$1.09 billion) plus interest on debts incurred by Moscow's failure to pay for goods delivered to Russia in the early 1990s.

The Russian government says the debts are linked to the now-defunct Soviet Union.

"The Russian government must pay. They have kept us waiting for 14 years," Gaon told The Associated Press.

Gaon said he was confident Noga would retrieve the funds in the coming days, once certain conditions set by the Geneva authorities have been fulfilled.

Geneva prosecutors could not immediately be reached to confirm what the next stage of legal proceedings will be.

The decision by Switzerland's highest court follows the seizure of bank accounts belonging to Russian government-linked bodies in France last week. That led Moscow to issue a formal complaint to France and threaten retaliatory legal measures against Noga.

[Copyright ap 2008]

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