A billionaire oligarch who wanted to give his wife “a minimum of £95 million” in a separation deal ahead of High Court fraud litigation that could “wipe him out” has been thwarted after judges said he must wait to see how much of his fortune he has left after the case.
Gennadiy Bogolyubov, who has £121 million of London property including a family home on Belgrave Square valued at £60 million in 2009 and a £20 million house in Belgravia, tried to gain approval for the agreement with his wife Sofia in a court application.
But the payout — which replaced a less generous pre-nuptial agreement between the pair — has had to be put on hold after the High Court and the Court of Appeal ruled that it should not be made until the outcome of the litigation against the oligarch.
One of the judges said it would be “illogical and wrong” for the money to be handed over until the extent of his “potentially massive liability” from the fraud case had been established.
The ruling followed an earlier admission by his wife’s barrister that the litigation, in which he and another oligarch, Igor Kolomoisky, are being sued by Ukraine’s biggest bank for a sum that now totals more than $4.2 billion, could “wipe out” Mr Bogolyubov’s wealth entirely.
The High Court case against Mr Bogolyubov, below, and Mr Kolomoisky, to be heard this month, involves claims that they siphoned off vast sums through a string of financial transactions.
The alleged scam involved deals in which loans were used to make advance payments for “impossibly large” quantities of commodities — from tankerloads of apple juice to cranes and diggers — that were never delivered.
Three UK companies were among hundreds used in what has been described as a “fraud of byzantine complexity”. Both Mr Bogolyubov, who lived in London before moving to Switzerland in 2017, and Mr Kolomoisky strongly deny the allegations, although a Court of Appeal judgment shows that both have admitted that there is a “good arguable case of fraud on an epic scale”.
Details of the attempted deal between Mr Bogolyubov and his wife emerged in a Court of Appeal judgment last month. It discloses that the pair signed a pre-nuptial agreement — under which Mrs Bogolyubova would receive a £1 million lump sum, plus £2 million for each year of marriage, maintenance of £500,000 a year and £20 million in trust.
The judgment states that the pair separated in 2016, the same year that litigation against Mr Bogolyubov was brought by Russian oil company Tatneft. It risked leaving him with a £300 million bill until it was dismissed on a “limitation point”.
Before this happened, a new separation agreement was reached giving Mrs Bogolyubova “a minimum of £95 million” but not formalised via court approval until an attempt was made in December 2021 to achieve this.
The new Court of Appeal judgment issued by Lady Justice King states, however, that this was after Privatbank had begun its own litigation against Mr Bogolyubov and secured a worldwide freezing order against his assets.
The judge says the High Court refused approval for the deal until the outcome of the Ukrainian bank’s case and that this decision should be upheld.
Lady Justice King said that information provided to the court by the couple put Mr Bogolyubov’s wealth at £3.8 billion, but that this would not be enough to meet his liabilities if he loses the Privatbank case.
She added: “It is accepted on behalf of the wife that in the event that Privatbank succeeds substantially in its action against the husband, the resulting damages order would ‘wipe him out’.”
