Alfa-Bank lashes out at mass media

Alfa-Bank will sue some mass media sources for their unscrupulous coverage of the recent developments in the bank, said Mikhail Friedman, chairman of the Alfa-Bank board of directors. "We have already placed our complaints against certain publications and intend to continue acting in this way," he added. He reports that the Alfa-Bank legal department has already been authorised to submit at the Court of Arbitration all evidence concerning the unscrupulous and untruthful coverage by the mass media of the bank situation within the period of July 5 to July 16.

Such publications and reports have been largely responsible for triggering off wide panic and hysteria which have led not only to tangible losses for the Alfa-bank and its clients but to the collapse of a number of small and medium banks as well as to the undermined reputation of commercial banks in general, said Friedman.

He added that the bank management took the decision to spend all the funds retrieved as a result of legal proceedings on compensation of material damage of Alfa-Bank depositors.

Friedman reports that the bank's direct losses alone come to $9 million while the ultimate total of damage which includes reputation scars and lost profits may reach tens of millions of US dollars.

Friedman noted that the three days of panic caused 20 percent of Alfa-Bank depositors to withdraw their savings. To bring the situation to normal, the share-holders had to deposit more than $1 billion, he added.

Friedman withstood from naming "the true customer" of the media reports but said, "We have made conclusions for ourselves." He also noted that individual journalists and publishers are to blame, too.