Belgium’s Kazakhgate

World’s rich­est fraud­ster is told he must pay back £244million he hid in the Virgin Islands”, pro­claimed the head­line in London’s Evening Standard news­pa­per (03 Dec 2013).

The gen­tle­man in ques­tion is Mukhtar Ablyazov, a cit­i­zen of Kazakhstan, who fled his home­land after a ‘black-hole’ now known to be around $7.6 bil­lion was found in the accounts of the Kazakh BTA bank, over which he had quick­ly acquired con­trol in 2004, fol­low­ing the death of the pre­vi­ous own­er in a hunt­ing accident.

There are reports that Ablyazov has made a deal to give evi­dence to the Belgian gov­ern­ment in the case of Patokh Chodiev, anoth­er Kazakh oli­garch, and cen­tral to the so-called “Kazakhgate” scan­dal, involv­ing the sale of French mil­i­tary air­craft to France, in return for Belgian nationality.

According to the Kazakh gov­ern­ment, the miss­ing funds from BTA Bank were the per­son­al sav­ings and pen­sion funds of Kazakh cit­i­zens, as well as sub­stan­tial loans from over­seas finan­cial institutions.

UK pen­sion­ers par­tic­u­lar­ly suf­fered when BTA sub­se­quent­ly col­lapsed. British pen­sion funds, on whose behalf the Royal Bank of Scotland had invest­ed in the bank, lost 80 per cent of their invest­ments’ val­ue. HSBC, Barclays, Morgan Stanley and Credit Suisse also suf­fered heavy losses.

On June 7th 2017, fol­low­ing a lengthy and com­plex inves­ti­ga­tion, Ablyazov, regard­ed by many as a “finan­cial genius”, was sen­tenced by a Kazakh court in absen­tia to a 20 year jail term for embezzlement.

Justice had, how­ev­er, caught up with Ablyazov some­what ear­li­er: he was arrest­ed and impris­oned by French Special Forces (it had report­ed­ly been alleged that he had a ‘pri­vate mili­tia’) at his man­sion in Mouans-Sartoux, near Cannes.

The arrest, came as a result of cer­tain legal prob­lems he had encoun­tered in London, where he had claimed polit­i­cal asylum.

Ablyazov, fugi­tive and asy­lum seek­er, had set him­self up nice­ly in England. As well as a £20 mil­lion man­sion in the high­ly pres­ti­gious Bishops Avenue – known as ‘Billionaires Row’ – in London’s Hampstead, he had also acquired a £1 mil­lion apart­ment in St John’s Wood, close to Lord’s Cricket Ground.

A less than mod­est 100 acre estate at Oakland Park in Berkshire, boast­ing eight hous­es and a pri­vate heli­pad, and con­ve­nient­ly close to the pres­ti­gious Oakland Park Golf Club, and Windsor Castle was also acquired.

However, an English court was to deprive Ablyazov of this high­ly impres­sive prop­er­ty portfolio.

BTA Bank had issued 11 writs against him for a total of $6 bil­lion, and as a result, in 2009 he was ordered by an English court to repay the val­ue of secu­ri­ties ille­gal­ly trans­ferred by him to his com­pa­nies in the British Virgin Islands.

A sub­se­quent freez­ing order for­bade Ablyazov to “In any way dis­pose of, deal with or dimin­ish the val­ue of any of his assets in England and Wales up to the val­ue of … £451,130,000 …

Ablyazov failed to com­ply, and in February 2012 High Court Judge Mr Justice Teare hand­ed down a sen­tence of 22 months impris­on­ment for con­tempt of court, say­ing “I do not con­sid­er that any­thing less would mark the seri­ous­ness of Mr Ablyazov’s con­duct in fail­ing to com­ply with the freez­ing order.

Although the pros­e­cu­tion is report­ed to have request­ed the court to place a watch on air­ports after Ablyazov failed to appear in court for sen­tenc­ing, it was already too late, as the accused had skipped the coun­try, on a bus bound for France, trav­el­ling on a false passport.

Warrants for his arrest were also out­stand­ing from Russia and Ukraine: he was to become the sub­ject of extra­di­tion orders from both coun­tries, and he was sub­se­quent­ly placed on Interpol’s ‘Red List’.

Ablyazov is cur­rent­ly the sub­ject of a mur­der inves­ti­ga­tion in his home coun­try. His pre­de­ces­sor as hard of BTA Bank, Yerzhan Tatishev, was killed with a shot to the head in 2004 in what was report­ed as a “hunt­ing accident”.

The man respon­si­ble for the killing, Muratkhan Tokmadi, has con­fessed that this killing was no acci­dent, and alleges that Mukhtar Ablyazov was the insti­ga­tor. It was, effec­tive­ly, a con­tract killing.

Just weeks after the death of his pre­de­ces­sor Tatishev, Ablyazov took con­trol of BTA.

A sec­ond per­son want­ed for ques­tion­ing in the BTA case is one Botagoz Jardemalie. She was employed by Ablyazov and became a mem­ber of the BTA board, flee­ing the coun­try in 2009: she also known to be cur­rent­ly res­i­dent in Belgium, with the sta­tus of polit­i­cal refugee.

In December 2016 the England and Wales Court of Appeal con­sid­ered alle­ga­tions that Ablyazov’s asso­ciate, Viktor Khrapunov, cur­rent­ly res­i­dent in Switzerland, had con­spired with Ablyazov in breach­ing the asset freez­ing order made against him by Justice Teare in the High Court.

The judge held that the Bank has a good arguable case in con­spir­a­cy against Mr Khrapunov to the req­ui­site stan­dard on the basis of his and Mr Ablyazov’s alleged breach­es of the freez­ing order and the receiver­ship order….” Further stat­ing that “Mr Khrapunov has not filed any evi­dence to deny that he has indeed assist­ed Mr Ablyazov in seek­ing to avoid the effect of the world­wide freez­ing order against him and the receiver­ship order in the ways alleged by the Bank.”

Viktor Khrapunov is, at the time of writ­ing, on Interpol’s ‘Red List’, want­ed in con­nec­tion with “The Creation and Guidance of an Organised Criminal Group or Criminal Association (Criminal Organisation), and Participation in a Criminal Association; Expropriation or Embezzlement of Trusted Property; Fraud; Legalisation of Monetary Funds or Other Property Obtained Illegally; Abuse of Official Powers; Receipt of a Bribe.

Viktor Khrapunov’s son, Ilyas, who is in fact Ablyazov’s son-in-law, is also on the Interpol want­ed list, fac­ing sim­i­lar allegations.

Mukhtar Ablyazov him­self has fea­tured on Interpol’s Red List, until an inter­ven­tion by four Members of the European Parliament, includ­ing British Labour MEP Julie Ward, signed a let­ter call­ing for the Red Notice to be removed from Ablyazov.

Ms. Ward, who has expressed con­cerns over the “polit­i­cal abuse” of the Red Notice process said ”Being a bil­lion­aire and oli­garch Mr Ablyazov is not exact­ly the sort of grass­roots activist I am nor­mal­ly involved with on such cases.

But what­ev­er alle­ga­tions he faces it is not jus­ti­fi­ca­tion for lock­ing some­one up for noth­ing oth­er than polit­i­cal­ly moti­vat­ed reasons.

If he has done some­thing wrong and this is proven in a court of law then he should, of course, face the con­se­quences for any crim­i­nal­i­ty.

The rela­tion­ships and eco­nom­ic dynam­ics between fugi­tive oli­garchs and Europe’s polit­i­cal elites must sure­ly be called into question.

By Jacobytes

Belgium’s Kazakhgate

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