Football club owner held in Baltics fraud probe

The Russian owner of Portsmouth Football Club has been arrested in London in connection with a money laundering probe that has rocked Lithuania and Latvia, officials said today.

Vladimir Antonov, 36, and a Lithuanian partner, Raimondas Baranauskas, 53, were detained on an arrest warrant issued by investigators probing alleged fraud and money laundering at his banks in the Baltic states, said Lithuanian prosecutor Tomas Krusna.

The Bank of Lithuania said on Thursday that his bank there, Snoras Bank, will be liquidated, calling it the best solution for country’s financial system and economy, which were jolted after the bank was nationalised and its operations halted.

Lithuanian regulators claim that hundreds of millions of euros were siphoned from Snoras, the country’s fifth-largest financial institution, while Latvian authorities have said that similar asset-stripping took place on a massive scale at Latvija Krajbanka, a subsidiary bank controlled by Snoras.

Lithuanian bank chief Vitas Vasiliauskas said the government was liquidating the bank rather than waste taxpayers’ money trying to help “a plane that won’t fly.”

The decision to liquidate Snoras means that Latvijas Krajbanka, which Snoras controls through a 68% stake, is almost certain to suffer the same fate given Latvia’s meagre financial resources.

When asked about Antonov’s arrest, London police said two men – aged 36 and 53 - were arrested in response to a Europe-wide arrest warrant in London’s financial centre.

Police said the two men remained in custody overnight and are due to appear in a London court later today.

Lithuanian prosecutors issued the warrant for Antonov, who owned over 60% of Snoras, and Baranauskas.

Antonov told the Lithuanian daily Respublika in a phone interview published on Thursday that he feared for his life.

“I returned to London because I live and work here – my family is here. Where else can I go? Russia? That would be a one-way ticket. I would have to stay there for safety, but this would be considered an escape attempt,” he said.

“I am ready to testify...I understand that extradition is inevitable. I can say it openly – I am scared that I may get killed,” Antonov said.

Lithuania’s Finance Ministry said today that they would pay out all guaranteed deposits – up to €100,000 – at Snoras by Christmas – requiring some four billion litas (€1.1bn) in funds.

Latvia’s government was due to hold an emergency meeting to discuss the fate of Latvijas Krajbanka.

Authorities in both Lithuania and Latvia say the two banks’ collapse does not pose a systemic risk since they are mid-sized and the two states have ample reserves to guarantee deposits.

Latvijas Krajbanka was taken over by regulators on Monday.

Janis Brazovskis, an official with Latvia’s Finance and Capital Markets Commission who was appointed to oversee Krajbanka, said earlier that Antonov’s failed attempt to acquire the troubled Swedish car-maker Saab might have triggered the Baltic banks’ downfall.

He said that approximately 100 million lats (€142m) were siphoned from the bank to increase its charter capital and finance Antonov’s investment projects – including the unsuccessful takeover of Saab.

Deposit holders in both countries are now forced to wait in long lines to withdraw money from cash machines.