Sergei Bakeshin explained to the importance of the position of the Supreme Court of the Russian Federation in a dispute over interim measures imposed on the property of a debtor’s relatives

Sergei Bakeshin - Counsel

In 2019, ex-banker Magomed Mukhiev was convicted of fraud and embezzlement of deposits in nine banks controlled by him. The court sentenced Mukhiev to ten years in prison with a fine of RUB 9.5 mn. Later, the convict initiated a personal bankruptcy procedure, within the framework of which the Deposit Insurance Agency (bankruptcy trustee) applied for seizure of the property of his 19 relatives in the amount of RUB 23 bn. According to the DIA, Mukhiev withdrew money from banks and used it to purchase real estate, registering it in the names of his family members. The courts of first and appellate instances rejected the DIA’s claim. One of the arguments was the absence of separate disputes about the return of property to the bankruptcy estate. The court of cassation considered the DIA’s arguments fair and pointed out that the imposition of the ban would make it possible to replenish the bankruptcy estate. The case has reached the Supreme Court and will be considered this week.

The Supreme Court’s ruling on the dispute in question may streamline the practice of “bankruptcy” collateral and bring it back into the general framework of application of this institution, Sergey Bakeshin, Counsel, Head of Dispute Resolution and Insolvency Practice at Maxima Legal, told the portal According to the expert, given the recent amendments that excluded the possibility of appealing against rulings on taking interim measures, this issue is of particular importance.

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