KAZAKHSTAN: PRESIDENT'S SON-IN-LAW TRIES, BUT FAILS, TO

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 000184

SIPDIS

E.O. 12958: DECL: 02/12/2020
TAGS: PGOV PREL PHUM SOCI KDEM KZ
SUBJECT: KAZAKHSTAN: PRESIDENT'S SON-IN-LAW TRIES, BUT FAILS, TO
MUTE CORRUPTION ALLEGATIONS

REF: A) 09 ASTANA 1762
B) ASTANA 119
C) 09 ASTANA 1761

Classified By: Charge d' Affaires, a.i. Pamela Spratlen: 1.4 (b),(d)


1. (SBU) SUMMARY: Timur Kulibayev, the President's influential
son-in-law and Deputy Chairman of the National Welfare Fund Samryk
Kazyna, sued four independent newspapers for publishing articles
alleging that he received major kick-backs from the Chinese for oil
contracts signed in 2003-05. The court initially sided with
Kulibayev, ordering on February 1 the confiscation of all print runs
that carried the story and placing a ban on any other articles
insulting Kulibayev's honor and dignity. It reversed its ruling on a
technicality after an outcry from civil society leaders and criticism
from the Organization for Security and Cooperation in Europe's (OSCE)
Representative on Freedom of the Media. Ousted, self-exiled chairman
of Bank Turam Alem (BTA) bank Mukhtar Ablyazov is the source of the
corruption allegations. The Financial Police opened an investigation
into Ablyazov's allegations on February 11. END SUMMARY.

KULIBAYEV SUES FOR LIBEL


2. (SBU) Timur Kulibayev, President Nazarbayev's influential
son-in-law and Deputy Chairman of National Welfare Fund
Samryk-Kazyna, filed a libel suit on February 1 against four
newspapers -- "Respublika," "Golos Respubliki," "Vzglyad," and
"Kursiv" -- after they published a story accusing him of corruption.
An Almaty district court, acting with uncharacteristic swiftness on
the same day, ordered the confiscation of all print runs containing
the story and placed a ban on future stories that "insult the honor
and dignity" of Kulibayev. The order was immediately delivered to
the four newspapers, as well as to other independent news outlets and
newspaper stalls across the country.

ABLYAZOV IS THE SOURCE


3. (SBU) The source of the offending story was a letter to media
outlets from Mukhtar Ablyazov, the ousted and self-exiled chairman of
the Bank Turam Alem (BTA) bank who fled the country following
accusations of embezzlement and financial fraud (ref A). In the
letter, Ablyazov accused Kulibayev of pocketing a portion of the
proceeds from the sale of a government stake in a Kazakhstani oil
company to the China National Petroleum Company (ref B) in 2003.
According to Radio Free Europe/Radio Liberty, Ablyazov has documents
proving Kulibayev's illegal machinations. Ablyazov's accusations
appeared in the media at the same time as a story that Dinara
Kulibayeva, Kulibayev's wife and Nazarbayev's daughter, bought a
luxurious villa in Switzerland for a record 74 million Swiss franc
(approximately $68.4).

CONDEMNATION FROM CIVIL SOCIETY

4. (SBU) The court order caused an uproar in civil society. Chief
editors and journalists of the four newspapers held press conferences
condemning the court decision as an attempt to "completely
exterminate independent media in Kazakhstan." Editor-in-Chief of
independent newspaper "Svoboda Slova," Gulzhan Yergaliyeva, called on
the Supreme Court to reverse "this shameful ruling." Political
opposition parties also joined in the protests. The Ak Zhol party --
seen by some as an opposition party closest to the government --
released an unusually harsh statement criticizing "this selective
justice" for "creating a cast of untouchables in Kazakhstan and
further legalizing corruption." International NGOs Freedom House and
the Committee to Protect Journalists publicly urged the courts to
rescind "the unacceptable gag-order," declaring that "censorship has
no place for the chair of the OSCE." On February 8, Miklos Haraszti,
the OSCE Representative on Freedom of the Media, released a statement
condemning libel lawsuits in Kazakhstan (as well as Tajikistan and
Hungary) as "dangerous attempts at censorship."

JUDICIAL MISTAKE


5. (SBU) The first inklings that not all in the government agreed
with the Almaty court ruling appeared on February 8. The Chair of
the Supreme Court, Musabek Alimbekov, told journalists that the
Almaty judge "may have made a mistake. Judges are human," he said,
"and humans make mistakes." Alimbekov noted that any potential
judicial mistake would have to be addressed in a court of higher
instance. General Prosecutor Kairat Mami also said that his office
was looking into a case of possible judicial malfeasance, based on a

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complaint from several journalists.

GAG-ORDER RESCINDED


6. (SBU) On February 9, the court rescinded its own ruling to ban
articles that "insult (Kulibayev's) honor and dignity." The ruling
was based on a technicality -- the judge ruled that Kulibayev did not
follow proper pre-trial procedures for libel cases when he failed to
ask the newspapers to print a retraction before filing suit. Civil
society activists greeted the verdict as a temporary victory, but did
not exclude the possibility that the President's powerful son-in-law
will find other ways to squelch the story in independent media. In
her ruling, the judge said she would consider the plaintiff's demand
for a public apology only if the media outlets refuse to publish a
refutation.

MORE TO COME?


7. (SBU) Meanwhile, Ablyazov continued his campaign against
Kulibayev. On February 8, he announced that he sent proof of
Kulibayev's embezzlement to the Prosecutor General's Office, the
parliament, and political parties. He also claimed to have sent
letters to several leading businessmen in Kazakhstan urging them to
share any information on Kulibayev's wrong-doings, and publicized an
email address (mukhtar.ablyazov@gmail.com) to which people could send
complaints against Kulibayev. Activists of the Alga opposition party
-- widely believed to be financed by Ablyazov -- made several
attempts to publicly deliver Ablyazov's letter to the parliament in
Astana. On two separate occasions, the group was detained by the
police for organizing an unsanctioned rally. On February 11,
Kazakhstan's State Agency for Fighting Economic and Corruption Crimes
(Financial Police) announced that it received Ablyazov's letter and
launched an investigation into the case.


8. (C) COMMENT: Ablyazov's allegations have started a flurry of
guessing games about the state of play in the power games among the
Kazakhstani elite. Most independent political analysts agree that
Ablyazov must have received the incriminating evidence from a third
party -- either Rakhat Aliyev, Nazarbayev's exiled former son-in-law,
or someone high enough in Kazakhstan's power echelons to have access
to this kind of information. Some allege that Ablyazov is the front
man for interests in the oil industry that want to diminish
Kulibayev's far-reaching influence in the energy sector. Others
speculate that this is a power play from one of the rival political
clans (ref C). All agree, however, that this case is all about power
and control. It is also an important test of freedom of expression
in Kazakhstan. The fact that the court rescinded its gag-order is a
positive sign, and here the strong statement from OSCE's Haraszti
certainly played a role. However, as civil society activists point
out, the judge's ruling leaves open the possibility for Kulibayev to
take further legal action if the newspapers refuse to print a
retraction. We will continue to watch closely how these power games
play out. END COMMENT.

SPRATLEN