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11.5 million documents reveal links to massive asset concealment

Apr 2016
Fraud updates
According to the BBC today, 11.5 million documents leaked from a Panamanian law firm (the so-called Panama Papers) reveal links to massive asset concealment running to billions of dollars being conducted by numerous international persons including heads of state. Such disclosure may enable fraud victims amongst others a unique opportunity to recover losses using the remedies offered by Courts in numerous jurisdictions to help them to locate, freeze and recover assets. PCB has extensive experience in this respect and is the UK member of ICC's FraudNet (https://icc-ccs.org/home/fraudnet), a worldwide network of lawyers specialising in asset recovery that has recovered billions of dollars for victim of some of the world's largest and most sophisticated global frauds. Read More

Parent company bound by Russian subsidiary’s agreement to arbitrate

Mar 2016
Fraud updates
If parties agree to refer to any disputes to arbitration, it would be reasonable to assume that only they can be parties to any ensuing arbitration. A recent decision of the English High Court concerning a lucrative redevelopment in Moscow has demonstrated that this is not always the case, and that parents of Russian companies in particular are vulnerable to being dragged into an arbitration to which they did not sign up. In Egiazaryan and another v OJSC OEK Finance and The City of Moscow [2015] EWHC 3532 (Comm), the High Court overturned an award by a LCIA tribunal seated in London. The claimants, who were parties to a shareholders’ agreement and share purchase agreement, alleged that the respondents had orchestrated a corporate raid to illegitimately seize their interest in the project. Those agreements were governed by English law and subject to an LCIA arbitration clause with a London seat. Notwithstanding that The City of Moscow was not a signatory to either agreement, the claimants attempted to rely upon Article 105 of the Russian Civil Code - pursuant to which a parent company can be jointly and severally liable on contracts entered into by its subsidiaries – to add The City of Moscow as a party to the arbitration and claim in tort against it under Article 1064 of the Russian Civil Code. The Arbitral Tribunal held that it did not have jurisdiction over the tort claim against The City of Moscow. This decision was challenged in the English High Court, where the judge found that the law of incorporation of the subsidiary (Russia) determined whether or not the parent was a party to the agreements and therefore bound by the arbitration clause. It was accordingly held that, under Russian law, the parent was so bound. Although Article 105 of the Russian Civil Code has since been replaced by Article 67.3 (which is in similar terms to Article 105), this is an important decision for arbitration disputes. Not only is it the case that non-signatories can be entitled or bound to be parties to an arbitration in cases of agency, assignment and lifting the corporate veil (for example) but now it is apparent that parents of Russian subsidiaries (and any other parties caught by similar provisions in other countries) can be unwittingly dragged into an arbitration as well. Read More

March 2016

Mar 2016
PCB news
ICC FraudNet, of which Steven Philippsohn is the English representative, was recognised again in Band 1 as the leading legal network for fraud by Chambers and Partners Global Guide 2016. Read More

February 2016

Feb 2016
PCB news
PCB Litigation has been retained by a private equity fund in the defence to claims of US$1bn+ in respect of transactions said to have put assets beyond the reach of a Greek telecommunications company.
In two recent successes, PCB Litigation obtained summary judgment and default judgment for its clients. Read More

January 2016

Jan 2016
PCB news
PCB Litigation has been retained by the respondents to a multi-million dollar freezing order granted in respect of assets held by an offshore discretionary trust.
PCB Litigation has been retained to act in the defence to claims being brought by a major UK bank for injunctive relief in respect of alleged confidential information. Read More

December 2015

Dec 2015
PCB news
PCB Litigation has been retained on a $multimillion fraud in the technology sector.
PCB Litigation has been retained on a £ multimillion investment fraud involving multiple jurisdictions.
On behalf of a major overseas Bank, PCB Litigation obtained Court Orders freezing the Defendant's worldwide assets in respect of a £ multimillion debt as well as requiring him to deliver up his passports and not leave the country.
PCB Litigation successfully opposed an application to amend a claim to add allegations of conspiracy to defraud. see transcript of Judgment of Newey J 27-11-2015 Read More

English Court rejects anti-suit injunction seeking to restrain Chinese proceedings

Nov 2015
Fraud updates
As fraud and asset recovery specialists, injunctions are an important tool of PCB Litigation’s trade, whether they be freezing injunctions, anti-suit injunctions, injunctions in support of overseas proceedings or similar forms of relief. In such cases, it is crucial for applicants to take steps in a timely manner. A recent case involving an attempt to restrain Chinese proceedings demonstrates what can go wrong when such steps are delayed. In that case, Essar Shipping Ltd v Bank of China Ltd [2015] EWHC 3266 (Comm), the bank had issued proceedings in China in September 2014 for over US$11 million. Those proceedings concerned a bill of lading which, under Chinese law, did not include a governing law and arbitration clause. In response, Essar challenged the Chinese court’s jurisdiction, asserting that the bill of lading contained a valid London arbitration clause under English law (the governing law of the contract, itself incorporated under English but not Chinese law). Essar’s challenge was issued in November 2014. This was shortly before, under English law, a potential time bar for commencing proceedings had expired. Nevertheless, it was not until July 2015 that Essar applied for an anti-suit injunction against the Bank in the specialist Commercial Court of England and Wales. The injunction sought to restrain the Chinese proceedings for having been commenced in breach of the London arbitration clause. The Commercial Court observed that it could grant anti-suit relief as long as it was “sought promptly and before the foreign proceedings are too far advanced”. Given that the time bar was 12 months, the length of the delay by Essar was considered to be significant, notwithstanding the ongoing jurisdictional challenge in China. In any event, the judge felt that there was no objective justification for considering that such challenge would be resolved speedily or that Essar would be successful, such as to justify the delay. Accordingly, Essar’s application was rejected. The case emphasises the need to proceed promptly when seeking injunctive relief. Having acted in such matters against parties from domestic and overseas locations like China, PCB Litigation is well placed to represent potential applicants and respondents in such circumstances. Read More

November 2015

Nov 2015
PCB news
PCB Litigation has been instructed by a Chinese manufacturer in a million dollar recovery claim against a UK purchaser.
PCB Litigation successfully defended applications for strike out and summary judgment brought against its client: see http://www.bailii.org/ew/cases/EWHC/Comm/2015/3073.html
“Highly regarded litigation boutique” PCB Litigation was again eminently ranked by Chambers UK 2016 as “great fraud specialists” who are “very cost-effective”, “hard-working, open-minded, co-operative and efficient” and “take a strategic approach”. Steven Philippsohn, Anthony Riem and Trevor Mascarenhas are all recognized as notable practitioners. Steven is noted as a “rainmaker” and a visionary in terms of his command of tactics, Anthony is well respected by clients" as well as "patient and nice to work with", and Trevor is “a clever and imaginative lawyer" and "a real thinker who comes up with solutions that are outside of the box and who will go the extra mile." Read More

Continued recognition for PCB Litigation

Nov 2015
Fraud updates
PCB Litigation is extremely grateful to our clients and colleagues for the substantial industry praise we have received recently: The “simply outstanding”, “highly qualified”, “extremely skilled” and “highly regarded litigation boutique”, containing a trio of “outstanding” asset recovery lawyers has been top-ranked by a number of publications, including the International “Who’s Who” Legal Asset Recovery 2015, The Legal 500 and Chambers & Partners. Amongst our highlighted work is our representation of the primary defendant to a $1bn claim (one of The lawyer’s Top 20 cases for 2014 and 2015), our instruction by Bank St. Petersburg in a cross-border asset recovery case, our acting for a defendant on a contempt of court application and our representation of Ritz Casino on a £5 million fraudulent misrepresentation claim. We are also very proud to say that Steven Philippsohn has been recognized as “world-class” and one of only five Most Highly Regarded Individuals in Europe for asset recovery. He has also been described as an “unparalleled” “doyen” and visionary in terms of his command of tactics. Meanwhile, Anthony Riem has been described as a “great tactician” who is “tremendous”, “great for complicated cases”, "well respected by clients", has “magnificent client-handling skills” and is "patient and nice to work with." Trevor Mascarenhas has been recommended as a “genius” with a “fine intellect”, a “remarkable lawyer”, “a clever and imaginative lawyer" and "a real thinker who comes up with solutions that are outside of the box and who will go the extra mile." Read More

Supreme Court rules that dishonesty will not be tolerated

Oct 2015
Fraud updates
Sharland (Appellant) v Sharland (Respondent) [2015] UKSC 60 and Gohil (Appellant) v Gohil (Respondent) [2015] UKSC 61 It is a firmly established principle in commercial cases that the English courts will not tolerate dishonesty, and material non-disclosure of assets during for instance injunctive proceedings can lead to the offending party being committed to prison. In a recent landmark ruling, the Supreme Court has confirmed that the same principle firmly applies to cases being heard in the family courts. The decision demonstrates that parties’ duty of full and frank disclosure to opposing parties and to the court is sacrosanct. The test case was brought by two women claiming they had been duped into accepting unfair divorce settlements by their former spouses who had given false evidence to the court in order to conceal their assets and true net worth. Alison Sharland and Varsha Gohil had each accepted a divorce settlement with their husbands which had been approved by the court. When it transpired that the husbands had provided material non-disclosure of their financial circumstances, with the deliberate intent of concealing assets, each woman asked the court to reassess their settlements. The court drew from the analogy of the remedies available for misrepresentation and non-disclosure in contract and held that the family courts are no exception to the general principle that fraud unravels all. Where a consent order has been procured by the dishonesty or fraud of one spouse, and impaired the financial settlement agreed to by the other spouse, it should be set aside and the terms of the settlement renegotiated. PCB Litigation has a long and successful track record of acting in fraud cases, in both the commercial and matrimonial arenas. As is often the case in matters of fraud, speed is of the essence. In this case, once the dishonesty of the husbands had transpired, the women acted with relative speed to apply to the courts for relief. Any delay in doing so may prejudice the preservation and recovery of assets before they are concealed, so victims of such frauds should seek advice on their position at the earliest opportunity. Read More

October 2015

Oct 2015
PCB news
PCB Litigation successfully defended a summary judgment application brought against its clients: see http://www.bailii.org/ew/cases/EWHC/Ch/2015/2830.html Read More

Tackling the Surge in Fraud

Sep 2015
Fraud updates
“While banks are of course targets for fraud, today businesses are firmly in the firing line, with virtually all sectors of the economy under threat from fraudsters” “Scandal over police failure to pursue millions of online frauds” “Fraud could be costing NHS in England £5.7bn a year, says report” Recent headlines have been dominated by the surge in fraud. Indeed this month NatWest prepared an article designed at identifying the golden rules that should be followed in order to be protected from fraud. Whilst the article focussed on common frauds (telephone, email and malicious software fraud), cheque fraud and invoice fraud, these frauds are merely the tip of the iceberg as fraudsters become increasingly more sophisticated. In the last year alone, we have acted in a multitude of diverse fraud cases across a range of jurisdictions involving email hacking, fraudulent websites, employee and management frauds, investor frauds, misstated accounts, false statements to the market, commodities fraud, banking frauds, the dissipation of assets, and bribery and corruption, to name but a few cases. One of the themes of the media’s coverage of this area is a suggestion that fraudsters are winning the battle in the fight against fraud, with under-resourced law enforcement authorities incapable of keeping up with perpetrators of fraud. For example, one recent statistic suggested that there have been an estimated 3.2 million frauds over the past year but less than 9,000 convictions. Whilst such figures are unattractive, they do not appear to take into account the number of successful pursuits of fraudsters in the civil arena. In that regard, choosing the right representation is fundamental to pursuing a strategy which not only leads to securing settlements and judgments against fraudsters but the recovery of assets from them as well. In that regard, PCB Litigation has a long track record of success, both domestically and as part of the ICC’s renowned FraudNet taskforce which provides an immediate global response unit containing dedicated fraud specialists. The reality of the pursuit of fraud is not the gloomy picture that the media portrays. Read More