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Khrapunov

Ilyas Khrapunov Found in Contempt by U.S. Federal Court

The U.S. District Court for the Southern District of New York has ruled in favor of the city of Almaty and BTA Bank, finding Ilyas Khrapunov guilty of contempt of court. New Verdict in Ongoing Legal Battle Federal Judge John G. Koeltl ruled that Khrapunov had violated a prior court order requiring him to report regularly on his assets. He had previously been ordered to pay $221,285.31 in sanctions. “After an independent review, the Court adopts the Magistrate Judge’s findings, which are well-founded and support a finding of civil contempt,” the judge’s statement reads. “Although Khrapunov has demonstrated an inability to pay the $221,285.31 judgment against him at this time, Khrapunov has failed to comply with the clear and unambiguous court order to submit quarterly declarations regarding his financial status.” The latest ruling reaffirms Khrapunov's obligation to fully disclose assets and make efforts to satisfy court judgments. It also includes provisions for further financial penalties in the event of non-compliance. Additionally, Khrapunov has been ordered to reimburse Almaty and BTA Bank for legal costs arising from his misconduct. A Central Figure in Corruption Scandals Ilyas Khrapunov is the son of former Almaty mayor Viktor Khrapunov and the son-in-law of fugitive banker Mukhtar Ablyazov, figures long entangled in corruption investigations. The Kazakh authorities have accused members of both families of large-scale embezzlement and money laundering. Viktor Khrapunov fled Kazakhstan in 2008 and has resided in Switzerland ever since. He was sentenced in absentia in 2018 to 17 years in prison for corruption-related offenses, a judgment he disputes. Ilyas Khrapunov also left Kazakhstan shortly beforehand. Almaty and BTA Bank continue to pursue legal action in U.S. and European courts, alleging that Ablyazov and his associates siphoned billions of dollars through offshore entities. Investigators assert that Khrapunov Jr. played a direct role in the schemes. Pattern of Legal Violations In December 2022, the Southern District Court in New York ruled against Ablyazov and his associates in the amount of $218 million. In June 2024, the U.S. District Court for the Southern District of New York awarded over $32 million in damages to BTA Bank and the City of Almaty, following a jury verdict against Khrapunov and Ablyazov’s associates, Felix Sater, Bayrock Group Inc., Global Habitat Solutions, and MeM Energy Partners LLC. The jury found the defendants liable for misappropriation of property, unjust enrichment, and money had and received, affirming fraud and money laundering schemes impacting Kazakh institutions. The plaintiffs estimated the total damage caused by Viktor Khrapunov and his wife, Leila, at over $300 million, including stalled development of city land and the "alienation of properties." In a related case, in September 2018, a UK court fined Ilyas Khrapunov $500 million for violating an asset freeze order in connection with Ablyazov’s fraudulent activities.

Corruption Allegations

Criminal Charges Against MEP Maria Arena Spark Renewed Debate on Central Asia Influence-for-Hire

In the latest chapter of a slow-burning story, on January 18, 2025, Antonio Panzeri’s successor as head of the European Union’s Subcommittee on Human Rights (DROI), Maria Arena, was charged with participating in a criminal organization concerning the Qatargate scandal. As far back as December 2022, shocking revelations had exposed collaboration between Panzeri, EU officials, and certain NGOs. This alliance turned their human rights advocacy into a self-serving commercial enterprise, yielding them €2.6 million and their clients favorable motions and resolutions in the European Parliament. The roles of Arena and Panzeri in commercializing their office by curating human rights targets and taking protective measures for monetary exchange warrant closer scrutiny. After leaving DROI, Panzeri continued to operate behind the scenes, having “almost 400 telephone calls” in ten months with Arena. As reported by Politico, her ties to the NGOs Fight Impunity (FI) and No Peace Without Justice (NPWJ) raised concerns about transparency and influence within DROI, especially as key figures from these NGOs faced corruption and money laundering charges in the EU’s Qatargate scandal. Arena’s leadership has also been criticized for allowing unbalanced hearings that favored Qatar’s interests while sidelining its critics. The scope of corruption extends beyond Qatar, with both Morocco and Mauritania mentioned as attempting to influence European Parliament decisions through bribery. All three countries — Qatar, Morocco, and Mauritania — deny any involvement. Germane to Central Asia, Maria Arena reportedly penned a letter to the Ambassador of Kazakhstan in Brussels calling for the release from prison of Karim Massimov, the former head of Kazakh intelligence who was sentenced to long-term imprisonment in his homeland for high treason, attempted coup and abuse of power. Journalists’ investigations have documented Massimov’s alleged links to major corruption, and he was closely associated with the authoritative regime of former President Nazarbayev. Arena’s push coincides with social media postings on 8 November 2022 by FI and NPWJ calling for Massimov’s release. Francesco Giorgi, an ex-parliamentary staffer at Fight Impunity and Panzeri aide who admitted partial guilt in the Qatargate bribery scandal, retweeted the post. A broader investigation suggests further malfeasance similar to Qatargate, in which Panzeri, Arena, and other EU officials collaborated with Mukhtar Ablyazov, a known criminal with judgments against him exceeding $4.8 billion dollars in the U.S. and British courts. Ablyazov is facing potential deportation from France following his evasion of a 22-month UK prison sentence for contempt of court. Despite this high-profile conviction in the UK, under DROI’s leadership, a faction of European politicians, including prominent names from the S&D including Panzeri and Maria Arena, along with their legislative partner Renew Europe, continued to align themselves with Ablyazov. An analysis of Ablyazov's supporters in the European Parliament, PACE, and national legislatures reveals a discernible pattern. During his time in Strasbourg, Ablyazov met with Panzeri – a figure labeled by The Spectator as one of Ablyazov’s “most diligent lawyers and active supporters.” Alongside Ablyazov was his daughter, Madina, who is married to Ilyas Khrapunov - found by a federal judge in...

Rule of law

In the Wake of Bishimbayev: From Politicians to Felons – Part One

Eight days ago, a scandal shook Kazakhstani society: Kuandyk Bishimbayev allegedly escaped from the penal colony where he was serving his sentence. Bishimbayev is a former high-ranking official of the government of Nursultan Nazarbayev's era, who was sentenced to 24 years in prison for the brutal murder of his wife. The Interior Ministry's Criminal Correctional System Committee immediately denied this information and said that a criminal case had been opened over the dissemination of this misinformation. This is not the first time Bishimbayev has become a resident of a penal colony. In 2017, as the Minister of National Economy of Kazakhstan, he was arrested on suspicion of large-scale bribery and embezzlement. In 2018, he was sentenced to a ten-year term with the confiscation of property and deprivation of the right to hold public office for the rest of his life. However, he was released on parole in 2019. Kazakhstan has been shaken by Bishimbayev's new crime. The trial, which was broadcast live online for the first time in the country's history, was watched by millions of citizens, not only within the Republic, but also abroad in other post-Soviet countries, and even in the West. However, this is not the first and, in all likelihood, not the last sensational case in which a former high-ranking official becomes a defendant. The long list of convicted ministers and akims can be divided chronologically into three parts: the Nazarbayev era, the transition period, and the so-called “New Kazakhstan,” which started after the January Events - the failed coup in 2022. This article discusses the most notorious court cases from each of these periods. Akezhan Kazhegeldin Former Prime Minister Akezhan Kazhegeldin was a politician known not only in Kazakhstan, but also in the West. He led the Government of Kazakhstan from 1994 to 1997. After falling into disfavor, in 1998 he attempted to challenge Nazarbayev in the upcoming presidential election. Kazhegeldin was not allowed to participate and had to leave Kazakhstan under the pretense of receiving medical treatment in Switzerland for unspecified health problems. In 1999, Kazhegeldin was put on an international wanted list, and in 2001 he was found guilty in absentia by the Supreme Court of Kazakhstan of abuse of power and authority, extortion and repeated bribes of millions of dollars, illegal acquisitions, the storage and transfer of weapons and ammunition, and tax evasion. Kazhegeldin was sentenced to ten years in prison, but has not returned to the country since. He continued to influence Kazakhstan's domestic politics from abroad until 2001 through the Republican People's Party of Kazakhstan, which he organized for this purpose. It was alleged that Kazhegeldin received kickbacks from a contract awarded to Tractebel in 1996 to run Almaty's electric company and power grid. A year later, the Belgian company also won a concession to manage gas pipelines in the south and west of Kazakhstan. In the U.S., meanwhile, the DOJ investigated claims Kazhegeldin received illegal payments of $6 million as part of a bribery scandal known as ‘Kazakhgate’. This...

BTA

Fugitive Oligarchs Ablyazov and Khrapunov Ordered to Return $32 Million to Kazakhstan by U.S. Court

Kazakhstan has secured a victory in the United States against Felix Sater and his companies, which were involved in investing money stolen by Mukhtar Ablyazov from BTA Bank. The jury in the U.S. District Court for the Southern District of New York awarded over $32 million in favor of BTA and the city of Almaty. In addition, the Kazakh oligarch and former Mayor of Almaty and Minister of Emergency Situations, Viktor Khrapunov, was reported by BTA's press service to have caused multi-billion-dollar damages through his actions. After a three-week trial, the jury recognized BTA Bank and the city of Almaty as victims of Sater's unlawful activities, which included the misappropriation of property, unjust enrichment, and obtaining money fraudulently. The compensation awarded exceeded the requested amount, totaling more than $32 million including interest. The trial, which began on June 10, 2024, demonstrated that Mukhtar Ablyazov abused his position at BTA Bank by issuing fictitious loans worth billions of dollars, leading to the bank’s collapse. At the time, BTA was the third-largest bank in Kazakhstan. Ablyazov also privatized state land and sold it at undervalued prices to companies he controlled. In addition, the Khrapunov's fraudulent actions, meanwhile, caused over $300 million in damages to Almaty, leaving significant urban land undeveloped, whilst other assets were sold to the Khrapunovs shell companies for significantly less than their market value through fictitious tenders. Evidence presented in court showed that Ablyazov and Khrapunov combined their stolen funds, with Ilyas Khrapunov, Viktor’s son and Ablyazov’s son-in-law, accused of laundering a substantial part of these funds. In September 2018, a UK court fined Ilyas Khrapunov $500 million for helping Ablyazov breach an asset freezing order. The Bayrock Group, Inc., Global Habitat Solutions (both owned by Sater), and MeM Energy Partners LLC (owned by Mendel Mochkin) were found to have facilitated the laundering of the stolen money into the U.S. financial system. The jury determined that Sater and Mochkin knowingly laundered the funds stolen by Ablyazov and Khrapunov. Additionally, the jury, having been presented with comprehensive evidence of Ablyazov's fraud against BTA Bank, returned a unanimous verdict against his co-conspirators. For the first time, a U.S. jury also unanimously ruled in favor of the city of Almaty concerning fraud committed by Viktor Khrapunov. Sater was not the only defendant in the asset laundering case. Daniel Ridloff and RRMI-DR LLC were also ordered to return assets to BTA and the Almaty Akimat. Ferrari Holdings LLC, another defendant, is in default, but Almaty Akimat and the bank plan to seek a judgment against it. In Kazakhstan, in 2018 Mukhtar Ablyazov was sentenced in absentia to life imprisonment for organizing a murder and embezzling funds from depositors of BTA Bank. In the same year, Viktor Khrapunov and his wife, Leila Khrapunova, were also sentenced in absentia to 17 and 14 years in prison, respectively. Back in December 2022, the Southern District Court in New York ruled against Ablyazov and his associates in the amount of $218 million. In total, Ablyazov stands accused of...

Ablyazov

“This isn’t Moscow” – Kazakh Oligarchs Scuppered in New York Court

In a tale which reaches from “fraud on an epic scale” in the UK to Donald Trump’s shady former business partners, a long-running case against fugitive banker and oligarch Mukhtar Ablyazov and his associates recorded another verdict in the New York Southern District court earlier this month. Yet despite having judgments against him totaling $4.9 billion in Britain alone, over a decade since he fled the UK on a fake passport to avoid three concurrent 22-month sentences for contempt of court, the former Minister for Energy, Industry and Trade in Kazakhstan - who has done business with multiple individuals sanctioned in the West - remains a free man, bemoaning his plight to be a case of “political persecution”. In the early days of Wild West capitalism following the collapse of the USSR, Ablyazov abandoned a career as a nuclear physicist to register a company selling fax machines, photocopiers and computers. By 1998, together with a consortium of investors, Ablyazov acquired a loan to buy Bank Turan Alem - later to become known as BTA Bank - in a privatization auction for a cut-price fee of $72 million. In 2005, he became chairman of the bank following the death of his predecessor, Yerzhan Tatishev, whom Ablyazov has been sentenced in absentia to life in prison in his homeland for ordering the murder of. In May 2019, the District Court of Fairfax, Virginia found Ablyazov’s sister, Gauhar Kusainova guilty of handling over $6 million of assets stolen by her brother from BTA. Already, in September 2018 a UK court had fined Ablyazov’s son-in-law, Ilyas Khrapunov, $500 million for helping him breach an asset freezing order. Ilyas is the son of the former Mayor of Almaty, Viktor Khrapunov, who is accused of embezzlement schemes amounting to at least $300 million and comingling funds with Ablyazov in Trump Organization projects. Viktor and his TV anchorwoman wife fled to Switzerland in August 2008 - allegedly loading up a chartered plane with 18 tonnes of art and antiquities - to join Ilyas, who had established an entity called the Swiss Development Group (SDG) - company slogan: “It’s Good to be Swiss”. By 2014, the Kazakh authorities had identified 58 shell companies and subsidiaries said to be controlled by Ilyas, (that’s nothing compared to Ablyazov’s 1000+) one of which was Triadou SPV. In 2016, Nicolas Bourg, the former Director of Triadou testified the Khrapunovs’ had ordered him to move money out of the US after a California lawsuit was filed against them. “Triadou is a shell entity for SDG,” he said. In the latest round of litigation, seeking to discredit the plaintiff’s witnesses, Mr. Roman for the defense spoke of the “lengths to which BTA Bank was prepared to go to find… Mr. Ablyazov’s allegedly stolen money,” and claimed BTA had paid witnesses, including Ilyas former business partners, Frank Monstrey ($25M) and Felix Sater ($2.7M). Roman argued that “Triadou didn't even know about Ablyazov’s freezing orders in London” and Triadou’s rehabilitation of Flathotel, Cabrini, Syracuse and the Tri-County Mall were not the actions of a shell company. “Triadou doesn't have BTA's money”, he concluded;...