Margaret Hodge has named and shamed 30 oligarchs and kleptocrats from Kazakhstan who the British Member of Parliament said had grown rich from stolen money. Hodge said: “Today, I want to shine a light on foreign corruption in another state, not simply because that is important in itself, but because I want to highlight the UK’s role in facilitating shameful wrongdoing. Put simply, Britain enables kleptocracy.” Hodge was hailed for urging Britain to shed its reputation as a laundromat for dirty Russian and Kazakh money. But the British MP missed one obvious name from the list of oligarchs and kleptocrats she read to Parliament: Akezhan Kazhegeldin. Kazhegeldin, also known as Ake-Jean Qajygeldin, is the former prime minister of Kazakhstan and fled the country in the late 1990s after falling out with the former president, Nursultan Nazarbayev. Kazhegeldin, a former KGB operative, has repeatedly been accused of corruption during his time in Kazakh politics. According to the United States Department of Justice, Kazhegeldin received “unlawful payments” of at least $6 million while he was prime minister. The Justice Department cited Kazhegeldin as one of three senior Kazakh officials who allegedly received bribes from James Giffen, an American businessman who had been negotiating oil deals in Kazakhstan. The New York Times described the DoJ case against Giffen as “the largest foreign bribery case brought against an American citizen”. The $6 million Giffen paid to Kazhegeldin was, according to the Justice Department, funnelled through offshore structures to hide the transactions. The money was sent to Pio V Limited, a company based in the British Virgin Islands, which in turn was owned by a Liechtenstein foundation called San Celestino. After Kazhegeldin fled his homeland, the Kazakh authorities brought bribery and corruption charges against him. In one of the most egregious cases, Kazhegeldin was judged to have used his influence as prime minister to take ownership of an oil refinery at Shymkent. The refinery was sold to a company secretly controlled by Kazhegeldin for just $60 million, despite recording annual profits of $40 million. The Kazakh Supreme Court found Kazhegeldin guilty in absentia and sentenced him to 10 years in prison. In exile, Kazhegeldin made his home in London less than a mile from the Houses of Parliament where Margaret Hodge gave her speech condemning Kazakh kleptocracy. For years Kazhegeldin lived in a luxury Belgravia property that was owned through opaque offshore companies – the sort of hidden structures that are often used by kleptocrats to hide their illicit wealth. The Panama Papers leak in 2016 revealed that Kazhegeldin’s daughter, Diana, owned the £3.75 million home on Wilton Street via a British Virgin Island-based company, which was in turn controlled by a New Zealand trust. Kazhegeldin has also owned properties via companies based in Jersey, Switzerland and Liechtenstein – all jurisdictions known for their low disclosure requirements, secrecy and preferable tax regimes. Given the allegations of corruption and the lavish lifestyle enjoyed by Kazhegeldin, he should have been included in the list of 30 oligarchs and kleptocrats named by Margaret Hodge in the British Parliament. Hodge said: “Our lack of transparency over foreign property ownership, our lax regulatory regime and our weak enforcement agencies have all aided and abetted the Kazakh elite.” It appears that the former Kazakh prime minister and exile, Akezhan Kazhegeldin, is still benefiting from the UK’s lack of transparency and lax regulatory regime for kleptocrats.
