Kazakhstan sues NY financier over $500 million-plus arbitration dispute

ALMATY (Reuters) - Kazakhstan is suing a New York financier, alleging he conspired with a Moldovan businessman to fraudulently secure an arbitration award of over $500 million against the oil-rich nation, according to documents filed with a New York court.

The Nur-Sultan government aims to hold emerging markets investor Daniel Chapman and his companies liable for all damages it has suffered as a result of lawsuits filed against it by Moldovan tycoon Anatolie Stati, his son and their companies, who are seeking to foreclose on a stake in a giant Kazakh oilfield.

Stati has won an arbitration award against Kazakhstan and has filed enforcement lawsuits in Britain, the European Union and the United States, briefly freezing $22 billion in assets owned by Kazakhstan’s rainy-day National Fund.

Although that freeze has been lifted, over $6 billion in other Kazakh sovereign fund assets remain frozen, mostly in the Netherlands, due to lawsuits by Stati and partners who accuse Kazakhstan of illegally nationalising their energy business.

Kazakhstan has in turn accused Stati of defrauding both the former Soviet republic and the Swedish arbitrators who ruled in his favour, charges he and his companies deny.

Further upping the stakes, in a lawsuit filed in the Supreme Court of the State of New York, the Nur-Sultan government accused Chapman and his companies of “conspiring with, and aiding and abetting, a fraudulent scheme” led by Stati.

Kazakhstan is seeking a jury trial and pursuing relief permitted by law, including compensatory and punitive damages.

“This includes any damages arising from the legal proceedings initiated by or involving the Statis in which the fraudulent scheme was perpetuated,” Justice Minister Marat Beketayev said in a statement.

A spokeswoman for Chapman and Argentem Creek Partners, a company where he serves as chief executive and which is also targeted in the lawsuit, said he and the company had no comment on the matter. A spokesman for Stati also had no comment.

The Stati camp said this month they would press ahead with legal proceedings, expected to conclude next year, to foreclose Kazakh sovereign fund Samruk-Kazyna’s stake in the giant Kashagan oilfield, after a Dutch court of appeal ruled in favour of recognising the arbitral award.

Reporting by Olzhas Auyezov; Editing by Mark Potter