On 28 October 2016, the Department of the State Enforcement Service of the Ministry of Justice of Ukraine initiated enforcement proceedings based on the ruling by the Pechersk District Court of Kiev ordering the seizure of the movable and immovable assets held by Mr Oleh Bakhmatiuk, as well as bank accounts held by FINANCIAL INITIATIVE PJSCCB and VAB BANK PJSC A foreclosure action was brought in respect of UAH 1.2 billion worth of assets pledged as collateral under the loan agreement between the NBU and VAB BANK PJSC in which Mr Bakhmatiuk acted as a surety. On 28 October 2016, as part of the enforcement proceedings, the residential property belonging to Mr Bakhmatiuk, with a total area of 1,049 square meters located in the town of Kozyn,Obukhiv district, was seized.
On 25 May 2015, the Pechersk district court of Kyiv sustained a lawsuit filed by the NBU and ordered the seizure of the movable and immovable property belonging Mr Bakhmatiuk. However, the State Enforcement Service refused to enforce the court's ruling on the grounds that the debtor’s address and identity number were not indicated in the court's ruling. "The refusal by the State Enforcement Service to enforce the court's ruling was based on formal reasoning and thus was contrary to law as the Supreme Court of Ukraine had provided clarifications in this regard and described as insufficient the reasons for the refusal given by the State Enforcement Service, which should itself find out the missing information required to enforce the court's ruling,” explained Director of the NBU Legal Department Mr Oleh Zamorskyi.
Therefore, the NBU filed a petition in court to challenge the refusal by the State Enforcement Service to enforce the court's ruling. In October 2016, the Pechersk district court of Kyiv sustained a lawsuit filed by the NBU and ordered the State Enforcement Service to initiate enforcement proceedings and seize the assets and bank accounts held by Mr Bakhmatiuk.
FINANCIAL INITIATIVE PJSCCB and VAB BANK PJSC are indirectly owned by Mr Bakhmatiuk through Invest-Service LLC and Quickcom Limited.
The NBU Board declared VAB BANK PJSC insolvent on 20 November 2014. FINANCIAL INITIATIVE PJSCCB was declared insolvent on 23 June 2015.