OSKEMEN, Kazakhstan -- The bumpy highway between the dusty Kazakh towns of Qalbatau and Maiqapshaghai in the remote province of East Kazakhstan has been under construction for six years.
Millions of dollars have been allotted to the project, but only half of the 415-kilometer road has been upgraded. On the remaining 200 or so kilometers, vehicles have to rumble over potholed or unpaved roads.
One major reason for the slow rate of progress on the highway may be due to massive fraud.
Kazakh prosecutors in April announced that nearly $44 million has been embezzled by a private company from the funds allocated to the road project.
On April 26, the Prosecutor-General’s Office named QazGerStroi, a limited-liability partnership, as possibly being behind the corruption. The main contractor for the project was the Chinese company Xinxing Corporation, with QazGerStroi acting as a subcontractor.
Prosecutors said QazGerStroi was “affiliated with entities [belonging to] Qairat Satybaldy,” the eldest nephew of former Kazakh President Nursultan Nazarbaev.
The once immensely influential and purportedly wealthy Satybaldy, 53, was sentenced to six years in prison on fraud and embezzlement charges in September 2022.
Prosecutors didn’t say who exactly was involved in the suspected embezzlement and whether any of the money allegedly stolen by QazGerStroi had been returned to the government.
Contacted by RFE/RL, representatives of QazAvtoJol -- a state company that manages Kazakhstan’s highways -- said QazGerStroi was removed from the project last year.
They accused QazGerStroi of “negligence” that caused a “significant slowdown in the pace of the construction work.” The remainder of the project will be completed by the Chinese company, QazAvtoJol officials said.
An investigation by RFE/RL’s Kazakh Service revealed that one of the former managers of QazGerStroi currently works for QazAvtoJol.
Who Owns QazGerStroi?
Until 2016, the legal owners of QazGerStroi were German businessman Robert Schumacher and Timur Turisbekov, the son of former Kazakh Interior Minister Zautbek Turisbekov.
Schumacher later claimed he was forced to give up the company under pressure from Gulmira Satybaldy, the former wife of Qairat Satybaldy, as well as individuals connected to former minister Turisbekov.
Asked by Kazakh media about the allegation at the time, Turisbekov said he wasn’t “that kind of person.”
Gulmira Satybaldy is currently serving a prison term on charges of embezzlement, the illegal appropriation of shares and assets of several enterprises, abduction, and actions aiding the commission of a crime.
Schumacher’s name has been removed from the list of QazGerStroi founders and the company was transferred to people linked to Qairat Satybaldy.
In 2017, Abai Zhunusov -- who is married to Gulmira Satybaldy’s sister -- became the chairman of the company.
Following Schumacher’s departure, Mirkhat Qasymbaev, who is currently a chairman on the QazAvtoJol board, became a co-owner of QazGerStroi through the Bereke Astana Group. Bereke -- which is also linked to the Satybaldy family -- owns QazGerStroi.
Qasymbaev is known to be close to Zautbek Turisbekov and served as Turisbekov’s assistant and adviser between 2005 and 2011 when the latter held several government and diplomatic positions, including ambassador to Uzbekistan and Russia.
Qasymbaev was listed as a founder of QazGerStroi through the Bereke Astana Group from 2017 to 2019.
QazAvtoJol confirmed to RFE/RL that Qasymbaev -- its current board chairman -- had once been a co-owner of a company that was carrying out the construction of the Qalbatau-Maiqapshaghai highway.
“He worked in QazGerStroi in 2019 only, but the construction works had begun much earlier,” QazAvtoJol representatives told RFE/RL.
But according to official documents, the work began in 2017, the same year Qasymbaev joined QazGerStroi.
Qasymbaev’s biography on the QazAvtoJol website also states that he served as vice president of the Bereke Astana Group and was a member of QazGerStroi’s supervisory board from 2011 to 2019.
Forbes Kazakhstan wrote that, under the leadership of Qasymbaev and Yernar Muratov, QazGerStroi was among the 10 largest recipients of tenders in the country in 2017.
RFE/RL contacted relevant authorities in Kazakhstan to clarify if Qasymbaev is suspected of involvement in the embezzlement of the QazGerStroi money.
But the Prosecutor-General’s Office, the Interior Ministry, and the Anti-Corruption Agency didn’t respond to RFE/RL inquiries.
No Names Released
Authorities have not said who is the main culprit of the alleged embezzlement of the funds for the highway project.
The Anti-Corruption Agency said a criminal probe on the issue had ended and the officials linked to the case were granted amnesty, though it didn’t disclose any names of those involved.
Kazakh authorities didn’t respond to questions of whether Qairat Satybaldy had been a suspect. The Prosecutor-General’s Office -- which publicly linked the crime to “entities” belonging to Satybaldy -- told RFE/RL that “the information is not subject to disclosure.”
This allegation of embezzlement wasn’t included in the criminal case against Satybaldy when he went on trial in 2022. At that time he was accused of embezzling funds from the Kazakhtelecom and Transport Service Center companies.
Meanwhile, QazGerStroi continues to win large contracts in tenders despite reportedly being removed from the Qalbatau-Maiqapshaghai project.
In 2023, the company secured a $5.2 million contract with the Astana city government to refurbish a road in the capital.
Bereke Astana Group is currently owned by Bauyrzhan Nursultan, the son of Qairat Satybaldy. Official documents list Aidar Lazarov as a co-founder of the company.
Nursultan continues to control a vast portfolio of lucrative businesses in various spheres, including mining, road construction, trade, and telecommunications.
The Prosecutor-General’s Office and the Anti-Corruption Agency did not respond to RFE/RL's questions about the $44 million allegedly stolen from the road project or if any of the money has been recovered.
It also remains unclear when the highway project will be completed.