Turkmenistan: Accused Central Bank Official Extradited to Russia
Aysoltan Niyazova, accused of embezzling $19.3 million from Turkmenistan's Central Bank, who has been on the lam for eight years, has finally been located in Switzerland and is being extradited to Russia, Russia's business daily Kommersant reports. (Niyazov is a common name and it is not known if she is a relative of past dictator Saparmurat Niyazov.)
Last year, when Turkmenistan joined the Financial Action Task Force (FATF), it was upgraded from the "blacklist" and put on the "improving" list for passing laws and starting to investigate and prosecute some of the rampant corruption and mismanagement in its opaque banking system. Then an arrest was finally made in the Central Banking case which dates back to 2002. Saveliy Burshtein, a Russian citizen, was accused of siphoning $19.3 from the Central Bank of Turkmenistan and sentenced to six years of prison. But a co-defendant tried in absentia, Aysoltan Niyazova, 38, a director of Moscow's Index-Bank was able to escape abroad, and remained at large for some eight years.
In January of this year, Niyazova, who holds dual Turkmen and Russian citizenship was eventually found by the Swiss police through Interpol. It then took months to arrange the extradition with Russia but now Niyazova is finally being returned to face imprisonment. As with other, similar cases, such as the rapid arrest and conviction of Central Bank employees this summer amid charges of bribe payments to Turkish construction firms, it is hard to know who is really guilty of what in this case involving at least five persons crossing international borders.
Back in 2002, German intelligence found that a Turkmen Central Bank employee, Arslan Kakaev, an officer of the international payments department, had removed $41 million from his bank in Turkmenistan and transferred it to Deutsche Bank and then to other banks -- about $20 million was sent to Latvia's Parex Bank; and another $20 million to the Russian Deposit Bank to an account opened by a Vietnamese citizen.
Kakaev was subsequently killed in St. Petersburg in 2003. That's when Niyazova and Burshtein were said to pick up the $19.3 million. According to prosecutors, a lot of the cash then disappeared in Czech Republic into the hotel business -- an industry where money is often laundered.
Another defendant in this case, Murad Garabaev, a former Turkmen Central Bank employee, was acquitted. His lawyer, Anna Stavitskaya, said she was surprised that Niyazova was extradited to Russia, and continues to claim that there is no proof that the $20 million came in fact from Turkmenistan or that it was even an illegal transfer -- no evidence was supplied to the court.
"It turns out that for the 6 weeks during which all this money was being taken out of the Central Bank of Turkmenistan, all the officers of this financial establishment were in a coma. But I think that what's more likely is that the transfer was fully authorized by the bank leadership," Stavitskaya told Kommersant.
That would imply that subordinates are now taking the hit for higher-ups, but how high?
Back then, Imamdurdy Gandymov, chairman of the Central Bank, was dismissed. Global Witness, an anti-corruption NGO, issued a report at the time calling on Deutsche Bank to investigate the large sums said to be transferred to Germany from state accounts by President Niyazov.
No more can be gleaned from the only partly-free media of Russia and the state press of Turkmenistan which hasn't covered the story. Meanwhile, watch out for emails claiming to be from the relatives of any of these figures, promising to cut you in on the stash, if you would only send them your bank account and social security numbers.
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