12 years for the trader who could not control his greed

Two greedy City traders who stole more than £100m from a Russian bank to buy mansions and fund their lavish globetrotting lifestyle have been jailed for a total of 19 years.

Georgy Urumov, 38, ‘preyed on the greed and gullibility of others’ as he swindled Russian-owned banking group Otkritie by recording the currency of two huge trades in American dollars rather than Argentine pesos.

The Russian then created a ‘smokescreen of falsehoods’ to cover his tracks with Threadneedle Asset Management Limited trader Vladimir Gersamia, 34, as tens of millions were siphoned through offshore accounts in Panama, Bahamas, British Virgin Islands, Geneva, and Zurich.

Arrogant Urumov dined in Michelin star restaurants throughout the scam and used the profits to buy a £19m mansion in ‘Millionaire’s Row’ in St John’s Wood, northwest London.

He was headhunted by Otkritie Securities Limited (OSL), part of the Otkritie Group, and persuaded the bank to pay his team of five traders £3.8m each in sign-on fees when they joined in early 2011.

Southwark Crown Court heard the Harvard-educated trader – who already earned £1.6m a year before his huge bonuses – kept £16.5m for himself.

Prosecutor Robert O’Sullivan QC said: ‘Urumov is not one of nature’s shrinking violets. There is of course nothing wrong with that and it is perhaps a character trait which most have to have in order to get ahead in his line of work.

‘However his forceful personality and self-confidence provides a back-drop to the events that unfolded over the months leading up to and during his employment at Otkritie.’

He continued: ‘This case is about City traders and the dishonest lengths that they go to, to make money, lots of money.

‘The male defendants were highly paid employees of city investment brokers who used their specialist knowledge and experience to conspire to extract millions of dollars from their employers through bogus trades.

‘They then devised an elaborate plan together with the fourth defendant to launder the proceeds of the fraud, that is to funnel the money through a series of offshore company bank accounts in quite an elaborate scheme.

‘At its height the first defendant, Mr Urumov, and the fourth defendant, Ms Balk, who are husband and wife purchased a house on what could be genuinely called Millionaire’s Row.’

In 2014 a High Court judge awarded OSL damages of over £123m after ruling that Urumov and Gersamia had spearheaded two ‘cunning and well-orchestrated’ frauds against the group between mid-2010 and the end of 2011.

Mr Justice Bernard Eder said it was ‘beyond any reasonable doubt’ that Urumov had acted with ‘blatant dishonesty’ and was ‘driven by simple greed and self-interest’.

OSL failed to recover disputed assets after the ruling and was forced to cover the loss themselves, jurors heard.

The Russian bank nearly collapsed and had to make 22 members of staff redundant.

Two OSL employees, Ruslan Pinaev and Sergey Kondratyuk, were said to have been friends of Urumov who helped get his team hired.

Swiss prosecutors are now battling to extradite Pinaev from Israel, while Kontratyuk was tried and jailed in Switzerland for his part in the fraud.

Urumov and Gersamia were jailed for 12 years and seven years respectively following their convictions for fraud and money laundering offences following a four-month trial at Southwark Crown Court.

Judge Deborah Taylor said: ‘This was a series of audacious frauds which culminated in the loss of $150million by Otkritie Group and the personal gain to both of you – to you Urumov, of about $40million… and you Gersamia about $6million.’

The judge slammed the pair for fooling Otkritie into believing their bogus trades were profitable and supported by Threadneedle Asset Management.

She continued: ‘You Urumov then began to draw the scent away by creating a smokescreen of falsehoods.

‘You were at the centre of these series of offences and you were motivated yourself by greed.

‘You used and preyed on the greed and gullibility of others.

‘You have show disdain and disregard for others throughout – you have been lying and casting blame on others.’

Urumov claimed during the trial that he had been made the beneficiary of offshore companies that benefited from the fraud without his knowledge.

Judge Taylor added: ‘It’s a measure of your confidence in the system you devised for the money laundering that you chose to put the money into UK property, perhaps in plain sight… showing arrogance and disdain for the interests of others.’

Urumov’s wife Yuri Balk, 37, and his fellow Otkritie trader Alessandro Gherzi, 38, were cleared of involvement in the £76million plot.

Urumov, of Ordnance Hill, St John’s Wood, was jailed for 12 years for two counts of conspiracy to commit fraud, two of conspiracy to defraud, and one of money laundering.

Gersamia, of Fairmont Avenue, Poplar, was jailed for seven years for two counts relating to fraud and one of money laundering.

Balk, also of Ordnance Hill, St John’s Wood, was cleared of two counts concerning money laundering.

Gherzi, of Jermyn Street, Westminster, was cleared of two counts of conspiracy to commit fraud, two of conspiracy to defraud, and one of money laundering.

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