Russia Hits Back with Multi-billion Penalty on Austrian Bank

The logo of Raiffeisen Bank International (RBI) is seen at its headquarters in Vienna, Austria, March 14, 2023. REUTERS/Leonhard Foeger/File
The logo of Raiffeisen Bank International (RBI) is seen at its headquarters in Vienna, Austria, March 14, 2023. REUTERS/Leonhard Foeger/File
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Russia Hits Back with Multi-billion Penalty on Austrian Bank

The logo of Raiffeisen Bank International (RBI) is seen at its headquarters in Vienna, Austria, March 14, 2023. REUTERS/Leonhard Foeger/File
The logo of Raiffeisen Bank International (RBI) is seen at its headquarters in Vienna, Austria, March 14, 2023. REUTERS/Leonhard Foeger/File

A Russian court's order for Austria's Raiffeisen Bank International to pay 2 billion euros ($2.1 billion) in damages for a collapsed deal shows Moscow's determination to strike back at the West, with companies bearing the brunt of the fallout.

Monday's ruling, delivered to a courtroom where armed men in balaclavas sat among those involved in the case, is a blow to the biggest Western bank in Russia, which has made billions of profits there during nearly three years of conflict with Ukraine.

It marks a watershed for the bank that has provided a payments bridge for Russia's middle class and companies into the West, requiring Raiffeisen to set aside a substantial amount for the loss even as it seeks to challenge the ruling, Reuters reported.

The judgement, made as Donald Trump was being sworn in as US president, serves as a warning to others, and prompted accusations by Raiffeisen's lawyer that the court was biased and that the masked men were there to intimidate.

The Russian lawyers taking the action against Raiffeisen said the men in the courtroom were bailiffs there to ensure order, accusing their opponents of "bombarding the court with unfounded petitions".

The penalty, issued by a court in the Russian exclave of Kaliningrad, follows the collapse of a deal involving Raiffeisen to release a Russian-owned stake in an Austrian builder, which unravelled under pressure from Washington. Now Raiffeisen has been lumbered with the bill.

"This is a final warning to all Western companies that you cannot do business with Putin's Russia," said Helmut Brandstaetter, a liberal Austrian lawmaker in the European Parliament.

The move also coincides with a deterioration in relations between Russia and Austria, long close to Moscow but which has gradually been unwinding its ties, abandoning a multibillion-dollar deal in recent weeks to buy Russian gas.

"Raiffeisen was long enough warned to pull out," said Brandstaetter. "It also shows that any continued bond between Austria and Russia will lead to disaster."

INEVITABLE RETALIATION

The ruling adds to worries for Western firms still operating in Russia, which include the likes of food companies PepsiCo , Procter & Gamble and Mondelez, and Italian bank UniCredit.

Ian Massey of risk consultancy S-RM said it was part of "pressure tactics, including increasingly punitive exit terms, asset seizures, and now ... huge fines."

"In the context of Russia's increasing diplomatic and economic isolation, retaliation against Western corporate symbols was nigh-on inevitable."

Monday's decision sees Russia follow through on previous threats to target privately-owned assets.

Last May, Moscow said it would identify US property that could be used for compensation over losses from the seizure of frozen Russian assets in the United States.

Moscow has already seized some assets and forced through sales to hand-picked buyers, as was the case for French yoghurt maker Danone and Danish brewer Carlsberg.

The Kremlin controls which companies are allowed to sell up and demands a heavy discount on the sale price.

Almost three years after Russia sent troops into Ukraine, Raiffeisen's continued presence in Russia underlines the lingering ties between Moscow and Vienna - with Vienna having served as a hub for cash from Russia and former Soviet states.

That bond put Raiffeisen and Austria on the front line of a global push by the United States to isolate Russia.

The court dispute followed the failure of a deal that Raiffeisen hoped would allow it to unlock some of its frozen billions in Russia.

The case was centred on a claim by Russian investment company Rasperia against builder Strabag, its Austrian shareholders and the Russian arm of Raiffeisen.

Raiffeisen had sought to buy a stake in Vienna-based Strabag from Rasperia, which Strabag had linked to Russian tycoon Oleg Deripaska.

Washington identified Rasperia as part of a group of Russian companies still controlled by Deripaska, when it imposed sanctions on some of those involved, scuppering the deal.

A spokesperson for Deripaska reiterated that he had no links with the company at the heart of the dispute with Raiffeisen.

Raiffeisen has around 6 billion euros in Russia, earned from international payments and from billions of euros of Russian deposits, a person with knowledge of the matter has told Reuters.



Trump Supporters Who Stormed US Capitol Begin to Leave Prison Following Sweeping Pardons

Stewart Rhodes, Oath Keepers founder, poses for a portrait after being released last night after spending the past 3 years in Cumberland, Maryland at the Federal Correctional Institution on January 21, 2025 in Washington, DC. (Getty Images via AFP)
Stewart Rhodes, Oath Keepers founder, poses for a portrait after being released last night after spending the past 3 years in Cumberland, Maryland at the Federal Correctional Institution on January 21, 2025 in Washington, DC. (Getty Images via AFP)
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Trump Supporters Who Stormed US Capitol Begin to Leave Prison Following Sweeping Pardons

Stewart Rhodes, Oath Keepers founder, poses for a portrait after being released last night after spending the past 3 years in Cumberland, Maryland at the Federal Correctional Institution on January 21, 2025 in Washington, DC. (Getty Images via AFP)
Stewart Rhodes, Oath Keepers founder, poses for a portrait after being released last night after spending the past 3 years in Cumberland, Maryland at the Federal Correctional Institution on January 21, 2025 in Washington, DC. (Getty Images via AFP)

Donald Trump supporters who attacked the US Capitol four years ago began to leave prison on Tuesday after the newly installed president issued sweeping pardons, an early signal that he intends to make aggressive use of his executive power.

The Republican president's pardon of 1,500 defendants on Monday evening, hours after he took the oath of office, drew outrage from lawmakers who were endangered and from some of the 140 police officers injured in the attack on Jan. 6, 2021, when thousands of Trump supporters stormed the Capitol in an unsuccessful attempt to prevent Congress from certifying Democrat Joe Biden's 2020 victory.

"I have been betrayed by my country," Michael Fanone, a former officer with Washington's Metropolitan Police Department who suffered severe injuries during the riot, told CNN on Monday after Trump's announcement. "Tonight, six individuals who assaulted me as I did my job on Jan. 6, as did hundreds of other law enforcement officers, will now walk free."

Trump's clemency extended from the people who committed only misdemeanors such as trespassing to those who attacked police officers and to the far smaller group who planned the assault on democracy.

One of Trump's fellow Republicans, Senator Thom Tillis, said pardoning rioters who assaulted police sent a wrong message.

"I saw an image today in my news clippings of the people who were crushing that police officer. None of them should get a pardon," Tillis told Reuters in a hallway interview. "You make this place less safe if you send the signal that police officers could potentially be assaulted and there is no consequence. It’s pretty straightforward to me."

White House spokesperson Karoline Leavitt defended the pardons, claiming without evidence that many of the convictions were politically motivated.

"President Trump campaigned on this promise," she said on Fox News. "It should come as no surprise that he delivered on it on Day One."

More than 1,000 defendants pleaded guilty rather than go to trial, including 327 who pleaded guilty to felonies, according to Justice Department statistics.

Stewart Rhodes, the former leader of the Oath Keepers militia who had his 18-year prison sentence commuted, was released shortly after midnight on Tuesday in Cumberland, Maryland.

Rhodes did not enter the US Capitol on Jan. 6, but he was found guilty of plotting to use force against Congress to prevent the election certification. He was also accused of helping to stockpile firearms at a hotel in nearby Virginia that could be ferried across the river to Washington, D.C.

Rhodes was one of 14 people whom Trump released from prison early, commuting their sentences, without fully pardoning them. That means they will continue to face some restrictions, including a ban on owning firearms.

The family of Enrique Tarrio, former leader of the Proud Boys, said his release was expected on Tuesday. Tarrio was not present at the Capitol on Jan. 6, but was sentenced to 22 years, the longest imposed on any defendant, after he was convicted of seditious conspiracy for his role in planning the attack.

LARGEST INVESTIGATION IN JUSTICE DEPARTMENT HISTORY

Trump's action shutters the largest investigation in the Justice Department's history, including more than 300 cases that had still been pending. Prosecutors filed dozens of motions to dismiss cases on Tuesday morning, federal court records showed.

In Washington, the trial of Kenneth Fuller and his son Caleb, who faced felony charges of obstructing police during a civil disorder, came to an abrupt end on Tuesday.

Federal judges in Washington - including some appointed by Trump - have for years handled Capitol riot cases and spoken of their alarm at the events of the day. At a November hearing, Trump-nominated US District Judge Carl Nichols said a blanket Jan. 6 pardon would be "beyond frustrating or disappointing," according to a court transcript.

The judge presiding over the Fullers' trial, Colleen Kollar-Kotelly, ordered it dismissed without discussion, noting that her ruling satisfied what she called Trump's edict.

Speaking to reporters afterward, Caleb Fuller, 22, told reporters that he and his parents celebrated in their hotel room after hearing Trump's decision on Monday night.

"I'm a free man now," he said.

Fuller said he didn’t witness any violence during the riot.

"I didn't see anyone get hurt," he said. "So I feel like everyone that was around me is deserving of a pardon."

The attack was spurred by Trump's refusal to acknowledge his defeat, which threatened the peaceful transfer of power for the first time in US history.

The sweeping action went further than many of Trump's allies had signaled. Both Vice President JD Vance and Trump's attorney general choice Pam Bondi had previously said they believed people who committed violence were unlikely to be pardoned.

'VIOLENCE IS THE NORM IN THIS COUNTRY'

Among those due to be released were leaders of the far-right Proud Boys organization, including some convicted of seditious conspiracy. About 40 men wearing Proud Boys insignia traded insults with protesters on the streets of Washington during Trump's inauguration on Monday.

Others due for release included Dominic Pezzola, who was accused of stealing a police officer's riot shield and using it to smash a window, beginning the breach of the Capitol.

Attorney Norm Pattis, who represents Rhodes and two other Jan. 6 leaders, disputed the notion that the clemency would lead to an increase in political violence.

"Our politics has always been violent," Pattis said, pointing to events ranging from the Civil War to the protests of the 1960s that sometimes led to bloodshed. "Violence is the norm in this country."

Trump's pardon was only one of a sheaf of executive orders he signed after an inauguration ceremony in the US Rotunda, where his supporters had rampaged four years earlier.

Trump kicked off a sweeping immigration crackdown, cut support for wind power and electric vehicles and cleared the way for oil drilling in the Arctic and in offshore areas. He withdrew from the Paris climate agreement and the World Health Organization.

He delayed the ban of the popular TikTok video app that was due to be shuttered on Sunday.