Norilsk Nickel's Private Pension Fund accuses Prokhorov of inefficient management
MOSCOW. Jan 25 (Interfax) - MMC Norilsk Nickel's Private Pension Fund is preparing a statement for law enforcement agencies regarding damages caused to the Fund by the company's top management, headed by former chief executive and head of Onexim Group Mikhail Prokhorov, the Fund's President Elena Akifieva told Interfax.
The Fund also plans to turn to Prokhorov with an open letter regarding compensation for losses attributable to funds accumulated for payments to Norilsk employees.
Akifieva said that as a result of the Fund's management by Norilsk's top managers led by Prokhorov, the Fund accumulated a total loss of 3.1 billion rubles.
In 2008, the PPF posted a balance sheet loss of 2.1 billion rubles, including 1.7 billion rubles on pension reserves financed by Norilsk Nickel and its employees, and 400 million rubles on pension savings. In addition, the Fund held paper totalling about 1 billion rubles, losses on which have not yet been booked as a result of ongoing litigation at the time with the issuers.
As Norilsk Nickel CEO, Prokhorov appointed the board of the Fund and essentially controlled its activities, Akifieva said.
She said about 95% of the Fund's assets were invested through a single management company - Rosbank Management Co., which was owned by Prokhorov's Onexim Group. Rosbank Management, among other things, bought securities that had an appraised value that was multiple times below the purchase price.
A spokesman for Prokhorov's presidential campaign headquarters told Interfax that Prokhorov has not been chief executive of Norilsk Nickel for more than five years. "During this time, audits surely should have been performed at the Fund, reports submitted to government agencies," he said.
"We consider the fact that any claims of damages are being made after the passage of this time to be a provocation and attempt to slander the presidential race participant M. Prokhorov," the campaign headquarters spokesman said.
A representative of Onexim, commenting on the PPF's claims, told Interfax that all funds suffered losses during this crisis period and the Norilsk Nickel PPF was no exception. "It's strange that this topic has resurfaced now," he said, recalling that the Fund had already made these claims against Rosbank Management Co. The management company went bankrupt in 2009, being unable to restructure the debts accumulated as a result of the financial crisis.
Norilsk Nickel agrees with the PPF's claims against the head of Onexim, a spokesman for the mining company told Interfax. "The results of 2008 do in fact show that the management of the fund at that time was ineffective. Now all problems have been resolved, the Fund is showing a decent return and is fulfilling all of the obligations to clients that it has assumed," the spokesman said.
Rosbank Management Company, later renamed RBusiness Asset Management, was acquired by Onexim following the split of assets between former business partners Vladimir Potanin and Prokhorov. However, it was announced in January 2009 that the group was selling 100% of Rosbank Management Co. to its managers. Soon after this, a number of partners - Norilsk Nickel PPF, Blagosostoyaniye PPF, Polyus Gold and others - filed claims against the management company totalling billions of rubles, though RBusiness's assets totalled slightly more than 200 million rubles.
As a result, the company filed for bankruptcy in December 2009 and began to transfer its mutual funds to Pallada Asset Management; a court declared the firm bankrupt in December 2010. Norilsk Nickel PPF filed a lawsuit against RBusiness in 2009, claiming 927 million rubles, and later a court ruled in favour of Polyus Gold in the gold miner's lawsuit against Rbusiness claiming nearly 5 billion rubles.