Kazakh bank seeks to jail former chairman
Mukhtar Ablyazov, former chairman of BTA Bank, Kazakh lender that defaulted on ?8bn of debt, faces contempt hearing
guardian.co.uk, Wednesday 30 November 2011
The former chairman of BTA Bank, the Kazakh lender that defaulted on $12bn (?8bn) of debt owed to the likes of Royal Bank of Scotland and Barclays, breached a court order after aides falsified documents to assist him in hiding his assets, the high court was told on Wednesday.
Mukhtar Ablyazov, who has fled Kazakhstan and been granted asylum in the UK, hid and dealt with his assets in violation of a 2009 freezing order by Mr Justice Teare, BTA’s barrister claimed at the start of a two-week contempt of court hearing. The bank is seeking a prison term for Ablyazov.
He also alleged that aides created back-dated documents to hide Ablyazov’s ownership of a British Virgin Islands-based business by installing another associate, Kairat Sadykov, as its proprietor.
“The Sadykov story was a clear concoction,” Stephen Smith QC, for BTA, told the court. “It was all done to protect Mr Ablyazov and his assets and is a very serious breach of your lordship’s order.”
The bank also alleges that the banker failed to disclose ownership of four UK properties, including a ?17m mansion on The Bishops Avenue in Hampstead and a 100-acre, ?18m estate near Windsor called Oakland Park, as well dealing with assets with a value of $80m via another company called Stantis.
The contempt hearing was triggered during the preamble to a massive embezzlement case in which BTA has filed a series of civil lawsuits against Ablyazov, claiming he took more than $5bn from the bank. He denies breaching the court order and giving false evidence and states that the allegations are based on inference rather than direct proof. He also denies the embezzlement claims, adding that they are politically motivated.
In July, Ablyazov won an application for political asylum in Britain after claiming he faces persecution should he return to Kazakhstan.
The former banker has lived in Britain since BTA was acquired by the Kazakhstan government in 2009 – a deal which Ablyazov says he was forced to agree to, because he was a leading figure in the opposition against long-serving Kazakhstan president Nursultan Nazarbayev. He also claims to have been imprisoned for political reasons.
As part of the embezzlement case, Ablyazov had to place an estimated $5bn of assets into receivership under the control of accountants KPMG. In December, the former banker was told by London’s high court that he “cannot be trusted” not to dissipate assets which the court had frozen.
Banks headquartered in Britain, such as Barclays and the 83%-state-owned Royal Bank of Scotland, are believed to be owed $500m by BTA.
Earlier in November, BTA secured a 21-month jail sentence against Ablyazov’s aide, Paul Kythreotis, for contempt for failing to disclose his assets. In June, Ablyazov’s brother-in-law, Syrym Shalabayev, was sentenced in his absence to 18 months in prison for contempt for not assisting the court.
The whereabouts of Shalabayev are unknown, but he is apparently due to give evidence during the current hearing via a video link from a secret location.