Mukhtar Ablyazov

Mukhtar Ablyazov (born 16 May 1963, Galkino, South Kazakhstan) is a Kazakh dissident, politician, economist, businessman, and banker. He is the founder and leader of ‘Democratic Choice of Kazakhstan’ (DCK), a political party which directly opposes the authoritarian rule of Nursultan Nazarbayev. He is also the author of Ablyazov against Nazarbayev.

Ablyazov is currently fighting extradition from France to Russia. In Russia, Ablyazov faces ill-treatment and unfair trial.^[1] Many Human Rights organisations, such as Amnesty International and Human Rights Watch, as well as European Parliamentarians have written to the French government advising against the extradition of Mukhtar Ablyazov.^[2][3][4]

Early life and education

In 1986, Ablyazov graduated from the Moscow Engineering and Physics Institute. There he earned a degree in theoretical physics.^[5] After graduation he worked as a junior researcher at the Kazakh National University.

In 1987, Ablyazov married Shalabayeva Alma.

In 1990, Ablyazov was enrolled in postgraduate studies in the Moscow Engineering and Physics Institute. For that reason, he was fired from his role as a junior researcher at the Kazakh National University.

Career

Ablyazov started working during the fall of the Soviet Union and the start of Kazakhstan's Independence. His first job was the buying and selling of computers and copying machines. In 1991, Ablyazov registered his first company and called it "Madina," which is the name of his first daughter.

In 1992, Ablyazov started his business by supplying all the regions of Kazakhstan with products such as salt, sugar, flower, matches, tea, chocolate, and medicine. In order to run this business, Ablyazov established Astana Holding in Kazakhstan, a multi-sector private holding company, which established and consisted of: "Astana-Sugar", "Astana-Food","Aral-Salt", "The Chimkent Pasta Factory", "Astana- Medical Service", "Astana-Motors", "Astana-Interotel", "Astana-Bank", "Trade House Zhanna (furniture)."

In 1998, together with a consortium of Kazakh investors, Ablyazov acquired a loan to buy the shares in Bank TuranAlem in a privatization auction for $72 million. He later paid back the loan. The bank later came to be known as BTA Bank.

In 1997, Ablyazov was appointed as head of the state-owned Kazakhstan Electricity Grid Operating Company. KEGOC was a company close to buncruptcy at the time of his appointment as its head. In one year, he managed to make the state-owned company profitable.

In 1998, as head of KEGOC, Ablyazov was named Minister for Energy, Industry, and Trade.^[6]

Ablyazov has been described by Radio Free Europe/Radio Liberty (RFE/RL) as “part of a younger generation” that Nursultan Nazarbaev, president of Kazakhstan, “hoped to harness as he pushed his resource-rich nation into the 21st century.” Yet after a few years, “Ablyazov and the others had broken ranks, citing disenchantment with endemic corruption in Nazarbaev's inner circle.”^[5]

Political career

In November 2001, Ablyazov and other colleagues, including fellow disenchanted proteges of Nazarbaev, co-founded the Democratic Choice of Kazakhstan (DCK), an opposition political movement that challenged the Nazarbayev regime. The DCK included a combination of existing politicians and major businessmen and called for the decentralisation of political power, a strong legislature, and an independent judiciary to balance the power concentrated in the executive branch. This opposition initiative, according to RFE/RL, “quickly drew the wrath of the regime.”^[5]

In July 2002, as one of the main leaders of the DCK, Ablyazov was convicted of “abusing official powers as a minister” and sentenced to six years in prison. Also sent to prison were his fellow would-be reformers and former Nazarbaev proteges Galymzhan Zhakiyanov and Altynbek Sarsenbaev.^[5]

Many observers, including the European Parliament^[7] and Amnesty International,^[8] considered the charges against Ablyazov to be politically motivated. His trial failed to meet international fair trial standards.^[8]

It is alleged that Ablyazov was subject to torture, beatings and other ill-treatment while he was in prison.^[9] In response to pressure from the international community, including Amnesty International and the European Parliament,^[10] he was released in May 2003 after only serving ten months, on the condition that he renounce politics.^[6]

Unlike Ablyazov, Zhakiyanov refused a pardon. Sarsenbaev was released from prison and later became head of Ak Zhol, an opposition party. He was assassinated in 2006.

Ablyazov moved to Moscow in 2003 to rebuild his business ties and in 2005 became the Chairman of the Board of Directors of BTA Bank.

After his release from prison, Ablyazov reportedly spent “millions of dollars funding opposition groups and independent media.” RFE/RL has quoted Yevgeny Zhovtis, head of the Kazakhstan International Bureau for Human Rights and Rule of Law, as saying that “Nazarbaev to a certain extent felt betrayed” by Ablyazov and the others, given that “he thinks that he provided them the space to become wealthy, to become well-known, to make a career in state service or in business, and they challenged him. When he pardoned Ablyazov in 2003 and allowed him to return to business in exchange for a promise not to be involved in politics and then found out that he was again involved in politics, of course Nazarbaev felt betrayed twice.”^[5]

While living in Russia and Kazakhstan, Ablyazov was the target of assassination attempts and an effort was made to kidnap his son from school.^[11]

BTA Bank growth

Ablyazov served as the Chairman of the Board of Directors of BTA Bank from 2005 to 2009. During Ablyazov's leadership, BTA Bank reported dynamic growth, and became one of the most promising banks in the CIS. By 2008, BTA Bank had grown to become the leader in the emerging markets, the fourth-largest bank among the CIS countries, and one of the three fastest-growing banks in the world. In 2007, Euromoney magazine named BTA Bank the best bank in Central Asia and in 2008 BTA Bank received the Global Finance award.^[12]

At the same time, between 2006 and 2008, Mukhtar Ablyazov had been pressured by the President of Kazakhstan, Nursultan Nazarbayev, to transfer 50% of shares of BTA Bank to the state. Ablyazov refused to transfer the bank's assets into the control of Nazarbayev, and, as a result, in February 2009, the bank was nationalised under the pretext of the need to save the banking sector from bankruptcy.

In 2008, BTA Bank was the largest commercial financial institution in Kazakhstan, with internal reserves allowing for cooperation with foreign and domestic owners of the shares. At the same time, BTA Bank was the largest creditor of the Kazakh economy – the bank owned about 30% of all the loans granted to legal entities. The control over BTA Bank has been illegally adopted by the National Welfare Fund ‘Samruk-Kazyna’, a holding company owned entirely by the state, despite the healthy condition of the bank. Timur Kulibayev, Nazarbayev’s son-in-law, was the president of this fund.^[13]

Alleged fraud charges

24 March 2009 BTA Bank launched legal proceedings against Ablyazov in the UK High Court shortly after his arrival in London.^[14]

In September 2009, Kazakhstan's sovereign wealth fund, Samruk-Kazyna, injected significant funds into BTA in an effort to keep the bank solvent, effectively becoming its majority shareholder.^[15] Shortly before Samruk-Kazyna's intervention Ablyazov fled Kazakhstan to London.

In 2010, a warrant was also issued for Ablyazov's arrest in Russia, where he was charged on four counts of financial crime and placed on an international wanted list.^[16]

Ablyazov was the subject of seven legal claims in the English High Court totalling $3.7 billion (£2.26 billion).^[17]

The first decision that Ablyazov lost in the UK courts was passed down by William Blair, brother of Tony Blair. Shortly after, Tony Blair was hired by Nazarbayev to be an economic advisor. Tony Blair was paid a multi-million dollar salary.

In October 2010, Ablyazov lost a legal fight to prevent his assets from being subject to a receivership order. The ruling came after Justice Teare stated that Ablyazov “cannot be trusted” not to dissipate his assets prior to trial.^[18]

Ablyazov argued, in his defense, that the takeover of BTA Bank by Samruk-Kazyna in February 2009 was “the culmination of the campaign by President Nazarbayev and his allies to wrest ownership and control of [BTA] from [Ablyazov].”^[19]

In a May 2011 letter, Ablyazov accused Nazarbaev and his advisor Bulat Utemuratov of being the real owners of a 48.73% share in KazZink, a firm that Glencore International was planning to buy at the time. Ablyazov wrote that “in 2005-2009, when Mr. Utemuratov was blackmailing me on behalf of” Nazarbaev, demanding a share in BTA Bank, “he asked me to transfer the stocks to the companies that control KazZink now.” Ablyazov said that he had testified to this effect in a London court.^[20] Ablyazov was granted asylum in the UK in July 2011, a recognition that he would face political persecution if sent back to Kazakhstan.^[21] Kazakhstan's request for his extradition was ignored.^[22] According to the Daily Telegraph, the Kazakh government threatened to punish British firms by awarding lucrative contracts to China if the UK granted Ablyazov asylum.^[23]

In early 2012, Kazakh authorities sought to impliciate Ablyazov in an alleged terror plot. One report suggested that an “obvious reason for trying to nail Ablyazov” was that “unlike other political figures in exile, he has a presence inside Kazakhstan through his links to an opposition group and local media outlets.” The accusation was, according to this report, “designed to tarnish his reputation – and that of his associates, too – in the eyes of the international community,” as well as to provide “a useful distraction from the embarrassment which the government suffered after violence in the western town of Janaozen in December [2011], in which its police force is accused of opening fire on protesters, killing 14 and injuring over 100.” The report said that “authorities seem dead set on eliminating Ablyazov’s capacity to exert any influence in Kazakstan (sic).”^[24]

In November 2012, a U.K. court ordered Mukhtar Ablyazov to pay £1.02 bln ($1.63 bln) plus interest. The court also ordered "new post-judgment asset-freezing orders be made against Mr. Ablyazov in an unlimited sum and new asset-freezing orders in relation to certain other defendants."^[25]

BTA Bank efforts

Shortly thereafter, Kazakhstan's sovereign wealth fund, Samruk-Kazyna, injected significant funds into BTA in an effort to keep the bank solvent, effectively becoming its majority shareholder.^[15]

It has been argued that BTA Bank “threatened to dominate the other Kazakh banks – banks that Nazarbayev controlled” and that the bank's forced nationalization in 2009 was part of an effort by Nazarbayev “to dispose of Ablyazov.”^[26]

Ablyazov's persecution and Osman warning

Following the issuing of the Kazakh warrant, Ablyazov left Kazakhstan for London.^[27] This made him, according to RFE/RL, one of “dozens of former high-ranking Kazakh officials who have fled abroad after falling out of favor.”^[5]

During his time in London, Ablyazov told The Standard that he was an “innocent...victim of persecution” by Nazarbaev and was “in fear of his life from his country's secret police, the KNB.”^[11] Claiming to be innocent of all charges, he “employed tight security to protect him from murder attempts” while living in London.^[28] Once, while he was being driven in London, a car “rammed his vehicle repeatedly.”^[11]

While in Britain, Ablyazov maintained close ties to opposition media in Kazakhstan. RFE/RL has noted that in 2011, the broadcaster K+ and the newspapers Vzglyad and Golos Respubliki, along with other private Kazakh media with ties to Ablyazov, “gave full-scale coverage to the bloody police crackdown on striking oil workers in the western city of Zhanaozen.” Not long after, Kazakh courts ordered these media outlets closed, along with the opposition Algha party, headed by Avladimir Kozlov, an Ablyazov ally, who was sentenced to a long prison term. The Nazarbaev regime reportedly considered Ablyazov to be implicated in these media outlets' critical coverage of the regime.^[5]

Also during his time in Britain, Ablyazov was the main source of funding for Aksara, an independent theater company whose productions challenge the Nazarbaev regime and seek to provide an alternative to the state-subsidized theater, which toes the government line.^[29]

On 29 January 2011, London metropolitan police served Mukhtar Ablyazov with a so-called ‘Osman warning’, notifying him of an assassination and kidnapping threat. Simultaneously, the police informed him that they couldn’t ensure him protection against this threat on a daily and hourly basis. In July 2011, the Home Office (british Ministry of the Interior) granted him asylum, citing the political motives behind the criminal charges initiated against him.^[30]

In 2012, a British judge ordered Ablyazov imprisoned for purportedly lying in court about his financial assets.^[31] Shortly thereafter, Ablyazov left Britain. It was charged that he exited the country in order to avoid imprisonment. His lawyers, however, said that he left because he had received a death threat. The lawyers further maintained that Ablyazov “did not embezzle the $6 billion claimed by the Kazakh government, but restructured the bank's holdings in order to protect them from precisely the kind of government takeover that took place in 2009.”^[5]

Since his departure from Britain, it has been unclear where Ablyazov is living, although he was widely believed to have gone to France.^[32]

Kidnapping of Ablyazov's wife and daughter

On May 29, 2013, Italian police raided a villa in Rome and took Ablyazov's wife, Alma Shalabaeva, and 6-year-old daughter, Alua Ablyazova, into custody. They were forcibly deported, on a private jet hired by the Kazakh embassy in Italy, within 72 hours to Almaty, Kazakhstan, despite having legal British and European residence permits.^[33] According to Radio Free Europe/Radio Liberty (RFE/RL), the explanation for this action was that Nazarbaev was taking them as “political hostages.” Ablyazov’s oldest daughter, Madina, told RFE/RL that Nazarbaev wants to get his hands on Ablyazov. “Not as a hostage. Probably, the minute they have him, they will just kill him. They want to kill him, because my father is the biggest opponent for the president.”^[5] Ablyazov's lawyer, Riccardo Olivo, rejected the claim that Ablyazov's wife and child had false papers, saying that both of them had “valid Kazakh passports and EU residency permits issued by Latvia.”

Olivio also charged that their rapid deportation from Italy “raised suspicions that Italian and Kazakh authorities had colluded on the deal.” A lawyer close to the Ablyazov family said: “A person could get arrested committing a violent crime in broad daylight and get better due process than they did.” Italy's Justice Ministry claims to have been unaware of the arrests and deportation until after the fact; Emma Bonino, the Italian Foreign Minister, has called the operation “abnormal.” Ablyazov, for his part, accused Nazarbaev of “kidnapping” his wife and child and of employing “outright terrorist tactics.”^[34]

The Italian media blamed the Interior Minister and the Deputy Prime Minister of Italy, Angelino Alfano simultaneously,, for the illegal deportation. He is also a member of the centre-right party ‘The People of Freedom’ headed by Silvio Berlusconi, known for his friendly relations with the President of Kazakhstan, Nursultan Nazarbayev.

The president of Italy, Giorgio Napolitano, expressed his stark criticism of the deportation of Alma Shalabayeva. He noted that the decision to deport her was made without necessary verification or thorough examination of the situation by the Italian bodies: “For any country, it is unacceptable to give in to the pressure and interference of foreign diplomacy, which resulted in the hasty expulsion of a mother and child from Italy on the basis of distorted information. I also believe that we need to fully guarantee fundamental rights of persons, regardless of the status which they have in our country”.

On 24 December 2013, a representative of the Kazakh Ministry of Foreign Affairs announced a change in the restriction of liberty measure for Alma Shalabayeva and the withdrawal of her prohibition from leaving Almaty. Shalabayeva and her daughter, Alua received their passports and left Kazakhstan.

On 18 April 2014, the Italian authorities granted Ablyazov’s wife and daughter refugee status. Alma and Alua received a 5-year renewable permit of stay. The decision on the award of refugee status was made by the Territorial Commission in Rome for Recognition of International Protection, under Article 1 of the Geneva Convention.

Ablyazov supporters

Ablyazov's is awaiting extradition from France to Russia. In Russia, Ablyazov faces ill-treatment and unfair trial.^[1] Many Human Rights organisations, such as Amnesty International and Human Rights Watch, as well as European Parliamentarians have written to the French government advising against the extradition of Mukhtar Ablyazov.^[2][3]

Personal life

During his time in London, Ablyazov was described as not fitting “the Western stereotype of the fabulously wealthy businessman from the old Soviet Union. No bling, no yachts, no trophy wife and no ostentatious cars, he cuts a modest figure, favouring Marks and Spencer suits.”^[11]

References