Served time for embezzlement and returned to old ways: “pseudo-equity holder” scheme uncovered in Kazakhstan

Tengrinews.kz — The Financial Monitoring Agency, under the coordination of the Prosecutor General’s Office, has completed an investigation into a criminal case involving the illegal acquisition of apartments through fictitious shared-construction agreements.
The scheme
According to investigators, B. A., who headed the Tolendi housing construction cooperative, organized a scheme to embezzle 10 billion tenge from 1,500 equity holders. In 2016, he was sentenced to eight years in prison over the case.
“The construction of the residential buildings was subsequently completed with the participation of the Astana akimat. Some of the apartments were intended for large families, orphans, people with disabilities and other socially vulnerable groups. After his release from prison, B. A. and his accomplices developed a new scheme to take possession of this real estate,” the Financial Monitoring Agency said.
The agency said fictitious agreements for share contributions were backdated and issued in the names of citizens who were not actually equity holders and had never purchased apartments. Complaints alleging fraud were then submitted to law enforcement agencies on behalf of these so-called pseudo-equity holders. Criminal cases were opened on this basis, and the applicants were recognized as victims.
The resulting court decisions were intended to be used to register ownership of the apartments. The properties were then to be sold to third parties, with the proceeds distributed among the members of the scheme.
“19 people named as suspects”
Investigators established that more than 80 pseudo-equity holders were involved in the scheme, with plans to register 170 properties in their names. As a result, an attempt to illegally seize apartments worth more than 4.4 billion tenge in total was prevented.

“The scheme involved a clear division of roles: some participants recruited pseudo-equity holders and drew up fictitious agreements in their names, while others sold them to third parties and provided support in criminal proceedings. The fictitious share contribution agreements were sold to citizens. The damage caused to them exceeded 400 million tenge,” the Financial Monitoring Agency said.

According to the agency, police officers were also found to have been involved. Investigations have been registered over abuse of official powers and falsification of evidence.

“Nineteen people have been named as suspects, and nine of them have been placed in pre-trial detention. Property worth more than 250 million tenge has been seized,” the agency said.

The pre-trial investigation has been completed, and the parties have begun reviewing the case materials. The Financial Monitoring Agency added that no further information may be disclosed under Article 201 of the Criminal Procedure Code.