Exclusive: UK regulators ‘failed’ to fully investigate firm before float
Almost six months since the delisting from the London Stock Exchange of the scandal-struck Kazakh mining giant ENRC, City regulators have been accused of failing again to investigate fully a Kazakhstan-based company before allowing it to float here.
Kazakhstan Kagazy is a packaging company based in Almaty, the country’s major commercial and cultural centre, which staged a $273m (£162m) flotation in London in 2007 by the investment bank ING.
However, the company defaulted on its debt two years later and its stock has performed dismally, crashing from $5 when it floated to just 10 US cents now.
New chief executive and now 30 per cent shareholder, Tomas Werner, has claimed it was the victim of a massive fraud by its previous bosses and shareholders Maksat Arip and Baglan Zhunus. The pair strenuously deny the allegations made by the company that they defrauded it out of about $135m. Mr Werner, who is British, has repeatedly attempted to get the UK regulators to investigate what went on at the company and this week has written again to the London Stock Exchange, the Serious Fraud Office, the Financial Conduct Authority and the City of London Police, urging them to investigate. None comment on their investigations as a matter of policy.
KK has filed a legal claim against the two former directors in London’s High Court, which is not expected to be heard until next year.
KK first wrote to regulators and police asking them to investigate last August when it obtained a worldwide interim freezing injunction against the ex-directors.
In a statement, KK told The Independent: “To date, no action has been taken by any of these regulators and agencies. Earlier this month, the Court of Appeal refused to lift the injunction.”
It added: “The City of London is the world’s leading financial centre. Its integrity has been challenged by the actions of Mr Arip and Mr Zhunus, who we say used the listing process to further their fraud. This requires full investigation if the City is not to suffer a serious blow to its reputation.”
Mr Arip and Mr Zhunus deny the claims that they made KK overpay for work carried out by local companies in Kazakhstan which went on to circulate the money back to companies the pair controlled.
After his recent failed attempt to get the Court of Appeal to overturn the freezing order on his assets, Mr Arip said: “The claims that have been brought against me are patently false, and represent an attempt of the current Kagazy management team to deflect blame away from their own gross mismanagement of the business over the past few years, for which the Kazakh employees and creditors of the business have paid a heavy price.
“I look forward to demonstrating that these claims are without foundation.”
Mr Werner became chief executive last April, having been a director since 2009. His CV claims he held senior positions at Deutsche Bank, Merrill Lynch and HSBC in New York, Zurich, Frankfurt, London.
He built up his current stake in KK during a restructuring of the company after its default.
- 1 Cyclist in Russia narrowly misses being hit by car and lorry
- 2 Y-40 Deep Joy: The world's deepest swimming pool
- 3 'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
- 4 Syria air strikes: President Obama undergoes Damascene conversion as Isis forces America to change tack
- 5 Pink Floyd new album: Band unveil cover art for first record in 20 years
Rihanna 'nude pictures' claims emerge on 4Chan as hacking scandal continues
Kim Kardashian 'nude photos' leaked on 4chan weeks after Jennifer Lawrence scandal
Deepika Padukone branded a 'hypocrite' by The Times Of India following anger over 'cleavage show' tweet
'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
Syria air strikes: President Obama undergoes Damascene conversion as Isis forces America to change tack
Scotland could still declare independence – even without referendum, says Alex Salmond
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Hilary Mantel 'should be investigated by police' over Margaret Thatcher assassination story, says Lord Bell
Plebgate MP Andrew Mitchell called officer a 'little s**t', claim court documents 'exposing ex-Chief Whip's 'record of abusing police'
Archbishop of Canterbury admits doubts about existence of God
Labour Party conference: Ed Balls to set out plan to freeze child benefit to balance books
iJobs Money & Business
£65000 Per Annum Benefits + bonus: Clearwater People Solutions Ltd: If you are...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...
£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...