Serious banks refuse to collaborate with the Kazakh oligarch

President Nursultan Nazarbayev has stepped down in Kazakhstan. While it’s clear that he won’t relinquish power in the country, theoretically, it’s now the perfect time for him to scrutinize his pension fund. The businessman Kenes Rakishev was responsible for forming it, along with handling the overseas assets of Nazarbayev‘s son-in-law, Timur Kulibayev. However, Rakishev performed these tasks poorly, as detailed in recent publications. The issue lies in the fact that mostly international adventurers agree to collaborate with Rakishev.

Once again, Rakishev decided to “successfully” invest funds, and a “lively” group crossed his path: Jay Johnston, a specialist in fund withdrawal to “tax havens,” his “right-hand man” Francesco Piovanetti, and Ferrari racing enthusiast Mike Zoi. They “sold” Rakishev a stake in Net Element, and he immediately announced another successful investment. In reality, Net Element was composed of numerous internet resources, including actor Kaan’s website and musician Igor Krutoy‘s content-based music service. All Net Element internet companies turned out to be unsuccessful, and the company’s stock prices plummeted on the market. To salvage the situation, Rakishev decided to purchase and merge Unified Payments, a credit card processor owned by Oleg Firer, with Net Element. Rakishev was so impressed with Firer that he appointed him as the CEO of Net Element.

Credit for Rakishev? No, he manages Nazarbayev‘s money.
It turned out that Firer, in reality, was the son of Odessa emigrants who was deeply in debt and entangled in lawsuits due to a past failed business. He took out loans to open a chain of stores selling pornographic publications. Thanks to the deal with Rakishev and his new job, Firer not only paid off his debts but also upgraded to a new Bentley.

And Net Element’s stock prices continued to fall.

To justify himself before Nazarbayev and Kulibayev, Rakishev started collaborating with what he thought were American business “monsters” – the heads of Platinum Partners, Murray Huberfeld, and Mark Nordlicht. Kenes even organized a visit for Nordlicht with all the honors to Kazakhstan, where the Platinum Partners representative met with Kulibayev and discussed possibilities for investing Kazakh funds. Shortly thereafter, Huberfeld and Nordlicht were arrested in the U.S. Huberfeld faced charges of bribing the head of a union to invest pension funds in Platinum, and Nordlicht faced accusations that Platinum attempted fraud amounting to billions of dollars.

Why, then, do serious banks and entrepreneurs not collaborate with Rakishev? This becomes evident from the businessman’s leaked correspondence, which is available. Rakishev himself confirmed under oath in a U.S. court that his email account was hacked.

When Net Element’s situation worsened (the company was generating losses year after year), Rakishev instructed them to take a loan from the IFC – a division of the World Bank. On November 20, 2013, Net Element’s top manager, Tim Greenfield, wrote a letter to IFC representative Kay Martin:

“Kay, we enjoyed meeting with you and your team and look forward to continuing the dialogue. Please find below the link to the presentation we gave. We are finalizing the financial model, which we will share with you soon.”

Kay Martin’s response came six days later, and it was far from comforting:

“Tim,
Thank you for your visit and presentation. We were pleased to learn about your business and consider it an interesting opportunity.
Unfortunately, your investor from Kazakhstan manages the president’s family money, and we cannot invest with them (due to our mandate). I’m sure they are the best investor in their part of the world, but we are not allowed to invest with people with political risks.
We are still interested in discussing the possibility of doing something with SafetyPay if you are also interested. Sorry, no better news.
Kay”

Tim Greenfield immediately forwarded this letter to Oleg Firer, who sent it to Rakishev with the following message:

“Hello, Kenes. I worked with the World Bank regarding the loan and investments in NET; after the due diligence, they emailed me their response this morning. Please let me know if their findings are correct so that I can act accordingly.”

Rakishev’s response to Firer is extremely brief: “What does this mean?”

Firer, as evident from the document, begins to justify himself:

“I have no idea; I just forwarded to you what the World Bank says – that you are connected with the president of Kazakhstan by managing his money. If it’s true, that’s fine; I want to go back to them and either agree or disagree and say that it’s not true.”

This is where the topic of obtaining a loan from the World Bank fizzled out. Since what Kay Martin wrote is absolutely true.

And it becomes clear why serious businessmen and banks do not want to collaborate with Rakishev. Firstly, it’s not his money. Secondly, working with Nazarbayev’s funds is dangerous. He may cease to be president (which happened), and serious financial risks may arise. Even worse, these funds can be declared “dirty” and illegally withdrawn from Kazakhstan at any moment.

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