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US Designates Raimbek Matraimov Under Global Magnitsky Act for Corruption

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US Designates Raimbek Matraimov Under Global Magnitsky Act for Corruption

Matraimov is alleged to have laundered $700 million out of Kyrgyzstan. Bishkek has let him off easy, but Washington has finally taken action.

US Designates Raimbek Matraimov Under Global Magnitsky Act for Corruption
Credit: Pixabay

In a statement posted on December 9 — International Anti-Corruption Day — the U.S. Treasury Department designated Raimbek Matraimov for sanction under the Global Magnitsky Act. 

Matraimov, a former deputy customs official, has long been the subject of rumors of corruption. The apparent great wealth of his family, despite his public job, earned him the nickname “Raim Millionaire” on Kyrgyz social media. Then last year a joint investigation by RFE/RL’s Kyrgyz Service, the Organized Crime and Corruption Reporting Project, and Kloop, a Kyrgyz news site, put meat on the bones of the rumors.

The designation of Matraimov comes just a few days after U.S. Ambassador to Kyrgyzstan Donald Lu, in the context of remarks delivered at a media awards ceremony, directly called out “Raim Million.”

What has been the most important Kyrgyz news story of the past 18 months since our last awards ceremony? Elections? Coronavirus? Revolution? No.

The single most important story of the past 18 months has been the investigative journalism about the criminal empire of Raim Million. 

The RFE/RL-OCCRP-Kloop investigation implicated Matraimov as a key part of an underground cargo empire run by a powerful Uyghur family, the Abdukadyrs. The Treasury Department press release accompanying the designation notes that Matraimov, in his position in the customs service, aided a “company” (presumably the Abdukadyrs) in evading customs fees.

The company would bribe customs officials, and, in return, these customs officials would clear more expensive products as low-value goods allowing for maximum profits. Additionally, the company’s goods would pass more quickly through customs terminals. The goods of other companies, not associated with this company and not paying bribes, would often be thoroughly inspected, unloaded from the trucks, and sit in customs warehouses for weeks, if not months.

His involvement didn’t stop there, either. A Chinese-born Uyghur businessman, Aierken Saimaiti, claimed to have laundered $700 million out of Kyrgyzstan, the proceeds of the Abdukadyrs’ illicit trading scheme, with the aid of Matraimov. Saimaiti provided ample evidence to support his claims to journalists. Then he was assassinated in Istanbul in November 2019. Eleven days later the investigation’s first reports were released.

After the first report landed, Kyrgyz citizens took to the streets despite chilly temperatures and snowy winds to protest. As Colleen Wood wrote at the time, “Protestors carried posters with Matraimov’s face plastered on them and chanted ‘Down with Rayim!’”

Matraimov is described in the reporting as “widely seen as so powerful that he is essentially untouchable.” And he proved it: In the ensuing months Matraimov sued the media outlets that had conducted the investigation and the Kyrgyz government accused journalists involved of corruption. All the while, Matraimov remained a free man. 

Then came the October 4, 2020 parliamentary election, in which two parties secured around 50 percent of the vote between them amid extensive allegations of vote buying. One of the parties, Mekenim Kyrgyzstan, included Matraimov’s brother Iskender on its party list. The party was widely believed to have been bankrolled by the family. The protests that emerged after the election, leading to the annulling of the results and triggering the political rollercoaster Kyrgyzstan is still on, were in some ways an extension of the anti-corruption protests in late 2019.

The dust settled, momentarily, in mid-October with Sadyr Japarov somehow atop the political pyramid as both prime minister and acting president despite having been in jail at the start of the month. Japarov did what every new Kyrgyz leader does and pledged to clean up corruption. In a too-smooth turn of events, Matraimov was detained and then released with a promise to compensate the Kyrgyz state 2 billion Kyrgyz soms ($24.6 million). Japarov used the moment to announce his big plan to combat corruption: an economic amnesty. Corrupt officials could simply pay back what they’d stolen and go on their way. 

In the ensuing weeks, Kyrgyz officials have reported on transfers made by Matraimov, but he hasn’t paid the full “damage” yet, despite a November 30 deadline. Even if Matraimov pays the 2 billion Kyrgyz som, at just under $25 million it’s a small fraction of the $700 million Matraimov allegedly had laundered out of Kyrgyzstan.

The Global Magnitsky Act, the version enacted in 2016 to succeed a 2012 law that specifically targeted Russian officials, allows the U.S. government to sanction foreign government officials, current or former, implicated in human rights abuses or significant corruption.

By being designated, Matraimov can be subject to targeted sanctions. “As a result of today’s action,” the Treasury press release states, “all property and interests in property of the persons above [i.e. Matraimov] that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC [Office of Foreign Assets Control].”

In his December 5 remarks, U.S. Ambassador to Kyrgyzstan Donald Lu highlighted the serious problem of corruption in Kyrgyzstan and the vital role journalists play in uncovering it. He trod a risky line, explaining the course of events noted above, and commenting on the “efforts by organized crime to influence the decisions of the interim government of Sadyr Japarov.  They used internet trolls, thugs on the streets, and threats of violence against Kyrgyzstan’s leaders.”

Lu then said what we’ve all been thinking: “This has been like a Hollywood mafia movie.  But you don’t yet know how the movie will end.”

Lu said the “movie ends” with governments holding criminals responsible and courageous people motivating them to do so.

In response, the Kyrgyz Ministry of Foreign Affairs responded on Twitter, accusing Lu of attempting to interfere in domestic affairs and “pressure” an investigation.

It can be expected that designating Matraimov under the Global Magnitsky Act will illicit a similar response.