BANKAS SNORAS AB 
By By its recent rulings, the Vilnius Regional Court has dismissed requests made by a number of SNORAS deposit certificate holders (the plaintiffs) to recognise the deposit certificates they purchased as void and treat the amounts subject to insurance payments in accordance with the Law on Insurance of Deposits and Obligations to Investors and through the Deposit Insurance Scheme.
The plaintiffs advised the Court that SNORAS bank employees had stated that the deposit certificates would be insured. They also stated that the bank did not provide them with all the necessary information relating to deposit certificates, including the associated risks.
By dismissing the claims, the Court stated that the Bank had collected the required information about its clients as prescribed by the law and that by signing the related documents the clients confirmed that they understood the essential conditions of the concluded transactions and the associated risks. In none of the documents did it state that the deposit insurance applies to deposit certificates and, more importantly, the deposit certificate schedule clearly stated that deposit insurance is not applicable to deposit certificates.
The Court also concluded that the Bank had adhered to the strict standards when selling financial products, and had provided clients and potential clients with all of the necessary information in relation to the service being offered, therefore meeting all the obligations of a financial institution.
What does this mean for deposit certificate holders?
SNORAS adhered to the strict standards when selling such financial products and did not mislead customers.
Deposit certificate agreements are a legally binding document and so anyone entering into such an agreement should have read everything carefully before signing it.
Deposit certificates are not covered by the Deposit Insurance Scheme and so deposit certificate holders remain 4th ranking creditors.
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