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. Last Updated: 07/27/2016

Former Banker Arrested in $2.4Bln Fraud Case

A Moscow court on Wednesday sanctioned the arrest of former banker Boris Sokalsky on suspicion of counterfeiting and illegal banking activities amounting to $2.4 billion.

Sokalsky served as chairman of the bank Novaya Ekonomicheskaya Pozitsiya, known as NEP Bank, which was stripped of its license on money-laundering charges in 2005.

The Interior Ministry said he was suspected of illegal banking activities, the production and sale of forged money or bonds and abuse of authority.

In a vaguely worded statement, the ministry said Sokalsky's actions caused 62 billion rubles to evade financial controls, violating "the exclusive right of the Russian Federation to financial regulation and incurring damage to the Central Bank's ability to exercise its main function of protecting and maintaining the sustainability of the ruble."

The statement did not specify whether Sokalsky had been charged.

Interior Ministry spokeswoman Svetlana Stasenko confirmed the arrest but refused to elaborate. His arrest was sanctioned by the Tverskoi District Court.

The ministry said Sokalsky had been working most recently as a low-level secretary at the Moscow City Arbitration Court. Sokalsky got the job March 19 and was working during a trial-period while his employer waited for him to provide information about his work history, RIA-Novosti reported. Sokalsky was fired Monday, the agency said.

It was the city arbitration court that declared Sokalsky's bank bankrupt in November 2005 — one month after the Central Bank stripped the bank of its license for money laundering, Interfax reported. The bank also failed to supply information on transactions to the Federal Financial Monitoring Service.