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Press Release: Swiss Asset Return Case Mishandled Under World Bank Watch

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DOWNLOAD REPORT: A Case of Irresponsible Asset Return? The Swiss-Kazakhstan $48.8  Million

Following a year long inves­ti­ga­tion, the Corruption and Human Rights Initiative (CHRI) have pub­lished their full find­ings on Kazakhstan II, pro­duced in col­lab­o­ra­tion with the Peter Zalmayev of Eurasia Democracy Initiative.

Kazakhstan II is the name giv­en to $48.8 mil­lion in funds belong­ing to the peo­ple of Kazakhstan,  con­fis­cat­ed by the Swiss Government in 2011 fol­low­ing a Geneva judi­cial inves­ti­ga­tion.

The funds were resti­tut­ed back to Kazakhstan through a high-risk return strat­e­gy, bro­kered and over­seen by the World Bank. CHRI’s find­ings reveal that the return process has been tar­nished by con­flicts of inter­est, polit­i­cal patron­age, evi­dence of fraud, and seri­ous breach­es of trans­paren­cy and report­ing require­ments.

Co-author of the report, Professor Kristian Lasslett, observes: “$48.8 mil­lion in frozen assets were fun­nelled back to Kazakhstan very qui­et­ly by the Swiss gov­ern­ment through a series of opaque instru­ments. The World Bank and Kazakh Government unfor­tu­nate­ly led the pub­lic to believe this was Swiss devel­op­ment aid, its shady ori­gins were hid­den from vic­tims”.

Free from the close pub­lic and inter­na­tion­al secu­ri­ty returned assets ordi­nar­i­ly gar­ner, the high-risk return strat­e­gy  saw the funds being steered by a con­sor­tium of Gongos head­ed by the President of Kazakhstan’s daugh­ter, Dariga Nazarbayeva, who is a senior Nur Otan politi­cian in her own right.

The report’s co-author Tom Mayne notes: “The mon­ey found its way into lav­ish pro­pa­gan­da cam­paigns, and organ­i­sa­tions head­ed by Zhas Otan offi­cials, the youth wing of the country’s author­i­tar­i­an Nur Otan par­ty. We also came across quite dis­arm­ing evi­dence of fraud”.

CHRI and the reports authors are call­ing on the Swiss Government and World Bank to put a freeze on any fur­ther non-essen­tial expen­di­ture, so a thor­ough inde­pen­dent inves­ti­ga­tion can be con­duct­ed into the appli­ca­tion of the resti­tut­ed funds, and new over­sight struc­tures engi­neered that can pro­tect the assets from any fur­ther abuse.

Fatima Kanji who heads CHRI’s London office con­cludes: “Victims of cor­rup­tion in Kazakhstan have unfor­tu­nate­ly seen their assets mis­han­dled by the World Bank and Swiss Government. They con­scious­ly set a low demon­stra­ble stan­dard for respon­si­ble asset return con­firm­ing the very fears of civ­il soci­ety: the repa­tri­a­tion of assets with­out pub­lic knowl­edge or con­sul­ta­tion, and the repeat­ed mis­use of cor­rupt assets. As the Swiss fast approach the resti­tu­tion of over half a bil­lion US Dollars in stolen assets to neigh­bour­ing Uzbekistan, now is the time to learn the lessons of Kazakhstan II to ensure these mis­takes are not repeat­ed”.

By Fatima Kanji

Press Release: Swiss Asset Return Case Mishandled Under World Bank Watch

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