Revealed: Top Tory Helps Dictator Create Tax-Haven for Dirty Russian Money

francles maudeFrancis Maude MP is advising Kazakhstan on how to create a financial "free zone", which is likely to handle big money from Russian oligarchs.

Francis Maude, a former Tory Trade Minister (until 2016) and a key member of the last Conservative government, is working for the autocratic President of Kazakhstan, helping him launch a financial "centre" that critics view as a new tax haven, VICE can reveal.

Francis Maude is working as an adviser to the Kazakh government's "Astana International Financial Centre" (AIFC). This will be a financial "Free Zone", in Astana, the capital of the former Soviet Republic. The Kazakh government hopes the AIFC will compete with other "International Financial Centres" like the offshore tax havens in the Channel Islands or Cayman Islands.

Maude's new job with the AIFC was revealed in a letter released by the Advisory Committee for Business Appointments (ACoBA), which monitors the revolving door between government and business. The letter was released this May, although Maude applied for the post last November. Maude is sitting on the "Advisory Council" of the AIFC.

The AIFC is a personal initiative of Kazakh president Nursultan Nazarbayev, part of what he calls his "100 Concrete Steps" to build the Kazakh economy.

Nazarbayev, widely viewed as an autocrat, has been president of Kazakhstan since 1990. According to US government reports, human rights abuses under his despotic rule in Kazakhstan include "arbitrary or unlawful killings", "detainee and prisoner torture and other abuse", "arbitrary arrest and detention; infringements on citizens’ privacy rights; prohibitive political party registration requirements; [and] restrictions on the activities of nongovernmental organisation".

The Astana International Financial Centre (AIFC) is meant to act as a conduit for investment money through Kazakhstan, by having typical tax haven laws. The "tax regime" for firms and rich individuals operating inside the AIFC include a complete exemption from any corporation tax or income tax until 2066. Critics say this means the AIFC will encourage tax evasion.

Kazakhstan is also famously corrupt. According to the latest US State Department report, "corruption remained widespread" in Kazahkstan and government "officials frequently engaged in corrupt practices with impunity".

Commenting on Maude’s new job, George Turner of campaign group the Tax Justice Network, said, "Companies and individuals operating in the Astana International Finance Centre will be exempt from income tax and corporation tax for 50 years. This is a tax haven within a country, which will no doubt promote all of the bad behaviour that takes place in tax havens."

He added that "politicians frequently claim to want to take on tax avoidance and evasion, but when the finance industry dangles in front of them the prospect of highly paid sinecures on leaving office, you have to wonder how hard they are going to push". In 2012, a spokesman for Francis Maude insisted that the Conservatives "take tax evasion and aggressive tax avoidance very seriously" after Maude suggested that describing a country as a tax haven was a "compliment".

It is very likely that the new AIFC will handle big money from Russia's oligarchs. Last December, Russian President Putin said, "Kazakhstan has been and remains our key partner in the sphere of the economy."

Naomi Hirst, a senior campaigner at leading anti-corruption group Global Witness, told VICE: "After the nerve agent attack in Salisbury, Theresa May announced a crack-down on dirty money to make the UK a safer place. Now a former Conservative minister has been given the go-ahead to help create a new offshore financial centre in a country already marred by corruption and human rights abuses."

She added that, "This hypocrisy isn’t just absurd, it's dangerous – if Lord Maude cares about global security he should reconsider his position."

The Advisory Committee on Business Appointments (ACoBA) – which decides whether jobs taken by politicians could involve conflicts of interests – approved Maude's new job, but they noted he had many meetings with Kazakh’s ruler, President Nazarbayev, and with Kazakh and AIFC officials while he was still a minister.

Lord Maude told the Committee that, when Trade Minister, he "met with Governor Kelimbetov, who is governor of the AIFC", over "lunch" in Kazakhstan in 2015.

The Department for International Trade gave further detail to ACoBO. These included Maude meeting "the Kazakh PM and Senior Ministers, including the current Governor of AIFC" on the 2015 visit to Kazakhstan. In addition, Maude "hosted" an "Intergovernmental Commission" for President Nazarbayev himself in 2015. The Department also showed that Maude "offered the Kazakh government" his "experience and expertise in a major privatisation programme".

The Committee told Maude there was a "clear link between this appointment and your responsibilities in Ministerial Office", but "considered that the gap between leaving office and taking up this role (over 18 months) is sufficient to mitigate any concerns about the propriety of this appointment".

Revealingly, the committee said that because the British government is already "supportive of the AIFC and sees it as a means by which the UK financial services sector can win new business", this meant there was "nothing to suggest" that "decisions you made in office were influenced by the hope or expectation of future employment". In other words, the UK government supports the creation of a tax haven by a dictator, so there is no conflict of interest if British ministers want to cash in. Kaching!

Maude is a very senior Tory – he was a minister under Margaret Thatcher in 1989, and is a former Chairman of the Conservative Party. He was a key figure in David Cameron’s government, in charge of Cameron’s "efficiency" and privatisation programme in the Cabinet Office before he became a Trade Minister. Maude was given a seat in the House of Lords in 2015. Since leaving government in March of 2016, Maude has taken on around ten jobs in banking, public relations and commercial intelligence.

VICE asked Maude about the new job, and the problems of tax havens and "dirty money", but he did not give any response.


Vice.Com, Jun 14 2018


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