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Peter Davis

An writer at FOMOdrive

  • Dec 13, 2023
  • 2 min read

An investor sued St. Petersburg Exchange and a broker due to blocking of assets

A private investor has, for the first time, taken legal action against the St. Petersburg Exchange and a broker associated with it.

He is demanding that the plaintiffs pay back more than half a million rubles due to the blocking of their assets.

The investor's demands are justified by multiple arguments.

Konstantin Smirnov, a private investor, has submitted a lawsuit to the Arbitration Court of the Novosibirsk Region against St. Petersburg Exchange and broker BCS, demanding the recovery of 570 thousand rubles due to the blocking of foreign assets that were previously traded on the St. Petersburg Stock Exchange, as reported by RBC.

The investor does not plan to ask for the return of the blocked securities, but rather to seek compensation for the losses incurred due to the restrictions on the disposal of assets. If the court rules in his favor, he expects to be able to recover the funds quickly with the help of the bailiff service.

The investor has provided a number of arguments to support his demands on the St. Petersburg Exchange and the BCS broker. Despite the imposition of sanctions, the regulations of the St. Petersburg Exchange do not explicitly state that trading should be suspended.

The broker failed to explain to him why private investors are unable to sell their own assets, and did not reveal the custody chain that is used to track the frozen assets.

Yulia Zykova, an entrepreneur from an initiative group of private investors who were affected by the US sanctions against the St. Petersburg Exchange, reported to Rambler about a meeting with the Exchange's leadership.

She said that after the meeting, they were "utterly disheartened" as they had encountered a "barrier" in terms of communication and obtaining answers to their queries.

In November 2023, the St. Petersburg Exchange was subject to US blocking sanctions. However, the US Treasury granted permission for certain transactions with the platform until January 31, 2024. Trading in foreign securities is still not allowed.

Evgeny Serdyukov, the head of the St. Petersburg Exchange, has previously expressed the expectation that the company will be granted permission by the US Treasury to withdraw assets and return them to customers in full.

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