BoNY turns tables in $22.5 bln Russian suit

By Simon Shuster

MOSCOW, Feb 6 (Reuters) - The Bank of New York (BK.N) moved on Wednesday to turn the tables in the $22.5 billion lawsuit it faces in Russia, claiming that a lawyer for the Russian customs service had falsified evidence.

The service, which said Wednesday's claim was "absurd", is suing the bank for damages related to a U.S. money-laundering case, in which a rogue employee at the bank helped launder $7 billion from Russia - thought to be the biggest such crime ever.

But on Wednesday, the Moscow arbitration court postponed the hearing for the third time, after BoNY's lawyer Ivan Marisin said U.S. lawyer Steven Marks, who represents the Russian side, had falsified the document that gives him power of attorney.

This document was dated April 27, 2007, Marisin said, but was printed on letterhead that the service only started using in October.

"The agreement was backdated. It could not have been given to Marks on that date, as the letterhead did not yet exist... This is a blatant falsification of evidence," Marisin said.

Asked by the judge to respond to the accusation, the customs service attorney Yekaterina Dukhina said: "I am in shock... This is absolutely unfounded."

Marks was not present in the courtroom, and was not answering his mobile or office phones on Wednesday.

Judge Lyudmila Pulova insisted he appear at the next hearing, scheduled for Feb. 13, to respond to the claim.

The customs service lawyers present were not able to produce originals of the documents put into question.

Outside the courtroom, Dukhina said the claim was "absurd".

"[The bank's lawyers] are doing this simply to divert the court's attention from the substance of the case."

She added that the head of the customs service, Andrei Belyaninov, seen as a close ally of President Vladimir Putin, "will be in shock over this."

UNPAID TAXES

The star witness for the customs service in this case is Lucy Edwards, a former Bank of New York vice-president who admitted in 2000 to being part of what is thought to be the largest money-laundering operation in history.

By her own admission, Edwards helped Russian businessmen siphon $7 billion out of the country through dummy companies and Bank of New York accounts set up by her husband in the 1990s.

A U.S. court sentenced the couple to six months of house arrest, now served, and $725,000 in fines and restitutions.

The bank for its part paid a total of $38 million in penalties, and signed a deal with the U.S. Department of Justice where it admitted to failures in monitoring its staff, but was never charged with fraud or money-laundering.

The customs service claims this deal did not compensate the Russian government for taxes that should have been collected on the transferred funds. The bank has said the case has no merit.

The sum of $22.5 billion is based on U.S. money-laundering laws, which the service has asked the Russian court to apply. The laws allow prosecutors to seek three times the total amount that was laundered.

(Editing by Richard Hubbard)