Author: admin | 16 Mar 2012
Preliminary results of an ongoing judicial investigation into the wheelings and dealings of former Almaty mayor Viktor Khrapunov have revealed a number of business connections through strings of both domestic and offshore companies in the style of his son’s spouse’s father Mukhtar Ablyazov. Some of them had already been identified in media reports. But names and locations of mailbox and camouflage companies also point at Switzerland as Khrapunov’s main haven to stack his embezzled funds and collected “commissions” years before he ended up on the bank of Lake Geneva himself: a well prepared network to cache assets’ and funds’ ownership and keep them out of reach for Kazakh authorities trying to recuperate lost paper and cash. A recent global request for Khrapunov’s arrest and subsequent extradition to Kazakhstan was issued in late February this year. Switzerland is unlikely to honour such a bid, since “economic offences” are excluded from its list of reasons to extradite any foreign citizen, and on top of that Khrapunov’s application for Swiss citizenship dates from earlier times and therefore the extradition request cannot be taken into consideration in the decision whether or not to grant it to him. This, and the lengthy procedures involved, will give him all the time he needs to erase the traces of his Ablyazov-style embezzlement web.
BY CHARLES VAN DER LEEUW, KZW SENIOR CONTRIBUTOR
Back in 2003, the city of Almaty issued a series of 15 promissory notes with a par value of a million US dollar each. Their collateral consisted of stock in a skeleton enterprise, apparently without any benchmark share price but at the same time the nominal holder of the construction contract for the new terminal of the Almaty international airport. The enterprise’s name was Delamore Trade and Investment, a subsidiary of Delamore Group, which in turn controlled Imstalkom. As described earlier, after the terminal was opened by the end of 2004 after two years of delay, its construction bill turned out to amount of the equivalent of 52 million US dollar rather than the $21 million in the budget. Imstalcom, which popped up in the final account once more, was reported to be left with a debt of 330 million tenge – about 2 million dollar at the time. Not a big sum, but enough to draw the attention of public prosecutors who after Khrapunov’s departure traced the company back to a parent firm called Kazan To. Behind the latter appeared to stick a certain Ablay Karimsakov, brother of a city administration top official called Tlek Karimsakov. In turn, Kazan To appeared to be wholly or partly under control of another company called Phoenix, owned by the Khrapunov family.
Delamore has recently been identified as the immediate buyer of the notes in preliminary investigation results by the prosecutor’s office. In the course of 2004, however, they appear to have sold their paper to a firm the name of which has not been disclosed, which in turn sold it to an Irish bank called Depfa. Though not pointed at by the authorities as a guilty party in their investigations after Khrapunov, the latter appears to have bought the notes for the total sum of 7 million dollar. Depfa Bank, with its headquarters in Dublin, is also the 100 per cent owner of the German real estate and mortgage company Hypo Real Estate Holding AG. The following year, the city of Almaty defaulted on its repayment, which prompted Depfa to take the case to court. In 2006, the municipality paid out the sum of $8,891,600 to Depfa, including trial costs and penalties, following a court order. What happened to the difference between that sum and the original purchasing price of $15 million plus premiums remains to be guessed. Prosecutors suspect a kickback along the string of deals to which Viktor Khrapunov must have been far from strange.
As written in earlier reports, Viktor Vyacheslavovich Khrapunov was born in 1948 in the village of Pryedgornoye, in the district of Glubokovsky in the northeast of Kazakhstan. After finishing the College of Industry and Technology in Ust-Kamenogorsk, he moved to Almaty started to work first as a repair mechanic, then as a foreman, and later as senior engineer at the Almaty Thermal Power Station during the day, while studying at the Almaty Institute of Electric Technology in the evening. Next to his professional career, Viktor Vyacheslavovich made sure to get well-established in party echelons – indispensable in those days to secure any longer-term career to speak of. He first won the position of chairman of the Almaty Lenin district Communist Party Committee, to be promoted little later to the post of first deputy chair of the Almaty City Council. From there, he move on to the position of chairman of the Executive Committee of the City Soviet of People’s Deputies, which stood under the direct authority of the all-Union Supreme Soviet. After a term in office as minister of energy and coal, and later minister of energy and natural resources following Kazakhstan’s independence as of 1991, he obtained the reward he had always seen as the crown on his career: mayor of the city and the city-province of Almaty, which he achieved in 1997 – the same year Almaty lost its position as capital of Kazakhstan to Astana, but with the explicit task to establish Almaty as a dynamic regional centre of business and education. For this purpose, state assets put on sale for next to nothing to anyone who even remotely pretended to redevelop them into viable commercial assets. Khrapunov found himself virtually in charge of that process, and clearly decided that just supervising it would be little beneficial, whereas participating in it at the same time looked extremely attractive. Moreover, at that stage, there was little taboo for such conflicts of interest.
According to initial information given in a series of articles published by the Kazakh periodical Vremya back in early 2007, Khrapunov’s main instrument to stash his gains was, and still is, a company called VILED International Unlimited, president of which was Khrapunov’s wife Leila Kalybekovna.. Numerous sites around town were bought by it that had no building permits and therefore looked of little value. He then ordered to issue building permits for them, which overnight multiplied their property value, and subsequently started offering them to the fortunate classes of Almaty. Viktor Khrapunov promoted his business by withholding almost all outdoor advertising on strategic locations in and around Almaty to anyone but an advertising agency affiliated with VILED. In all, at least 16 prime sites have been allocated in closed procedures circumventing all open bidding requirements in this manner, authorities reported towards the end of 2011. Some of these larger objects appropriated by the Khrapunovs included a plaza on the corner of Gogolya and Panfilova Streets, apartment and shopping space blocks on Furmanova Street Dostyk Avenue, both on the edges of the uppity business neighbourhood of Samal-2.
For all 12 blocks downtown Almaty identified as falling under VILED’s umbrella, together no more than the equivalent of 60 million US dollar was allegedly paid – at least this is what Khrapunov was to claim later – but in any case never found back in any budget in the city administration where the sums for the purchases should have been registered. Further uphill, property, including parts of protected natural zones, were bought up by VILED and affiliated firms for even more hilarious sums. Thus, a forest site named Wood Fairy Tale and another one known as Oak Grove were purchased by a company called Gulmira Ltd., run by one of the Krapunov pair’s associates by the name of Shebityevov and believed to be financially dependent on VILED, for the negligible amounts of 1.8 and 2.1 million tenge respectively. Public property has also been sold illegally to another one among Khrapunov’s shell firms called Phoenix Unlimited, run by a certain Abdulaziz Mukashev, who in particular obtained blue-chip locations with permission to demolish the kindergardens, pensioners’ homes and other social facilities located on them, with the aim to build commercial glamour objects on them. Phoenix at some stage was taken under the umbrella of an affiliated holding called Swiss Kazakh Phoenix Holding, assumedly having its headquarters in Switzerland.
Phoenix was first established on November 19 2003 and according to Swiss trade registers it initially had a board consisting of Viktor Khrapunov’s spouse Leyla, their son Ilyas and his father’s daughter from his first marriage Elvira Byelmadani. As of April 2004, a certain Aynagul Sadikbayeva replaced Almaty’s first lady and the name of Daniyel Khrapunov, his and Leyla’s youngest son who had been borm less than five years earlier, was added to the list. On June 17, 2005, the company’s name changed into Swiss Kazakh Phoenix Holding, to change little later into Swiss Kazakh Phoenix Holding Internationa, located at 63 Tole Bi (former Komsomolskaya) street, downtown Almaty. From there on, it was headed by a Swiss national named Philippe Meyer.
The list of Potemkin firms to clinch the shadow deals may not be as long as Mukhtar Ablyazov’s 600-plus shell companies around the globe, but its structure is still impressive and its pattern showing striking similarities to Ablyazov’s schemes. Names of companies in Kazakhstan affiliated with VILED and Phoenix include Central Asia Realty, General Realty, Taza Bulak, Kazrealincom, Ademytau KMK, Victoria KMK and Techmedservice. Some of them have been used for Khrapunov’s advertising business, others for his real estate transactions. On the financial side, apart from the Irish banking corporation already mentioned, Khrapunov’s main instrument seems to have been, and probably still is, a Swiss company called Helvetica Capital SA, rue du Mont Blanc 3, Geneva. With a share capital of 100,000 Swiss francs, divided in 1,000 shares, the enterprise’s goal is being described as prise et administration de participations dans toutes soci?t?s ou enterprises ? l’exclusion de prise de participations dans les soci?t?s immobili?res en Suisse. In other words: a nominee interest holder in all kinds of enterprises with little other aim than hiding the identity of the true owner.
As of January 19 2010, Helvetic Capital, registered in Switzerland, had two authorised directors, being Leyla Khrapunova and Swiss national by the name of Marc Gillieron. A note dated April 4 2011 was to report Leyla’s retreat from her post, leaving the entire job to her Swiss peer. The Swiss company, for all it mattered, had, and assumedly still has, a Dutch subsidiary called Helvetic Capital BV, based at Schiphol Airport near Amsterdam. The function of the subsidiary remained unclear but there is an indication that the Khrapunov couple had used it, and might still be using it, for the flower business they had acquired through the notorious stock-for-loan swaps that took place in the wake of the disintegration of the USSR. Authorities in Kazakhstan, however, have left a blank spot on this possible connection in the overall scheme so far.
As for Khrapunov’s Almaty venture which had started shortly after his appointment in 2002, it was to end on the spot rather abruptly in early 2007 as Viktor Vyacheslavovich was appointed minister of emergencies and called to Astana. He held the post for less than a year, when he was put in place as governor of the Pavlodar province in the northeast of the country. Shortly afterwards, he and his wife joined his children in Switzerland, where he applied for Swiss citizenship. This, however, would by no means mean the end of the process through which the embezzled money was to be laundered, which, as a subsequent episode of the story to be filed soon will show, is suspected to involve international financial corporations of name and fame until the avalanche of non-commitments that rolled from the global Ponzy scheme in the wake of the cracks that started in the USA only to ripple through around the planet soon.
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