Kazakh bank says Chetrit helped launder $40M through real estate deals

BTA Bank, City of Almaty claim developer hid cash in Flatotel and Cabrini condo conversions
October 15, 2015 09:08AM

The Chetrit Group’s Joe Chetrit has been accused of participating in an international money laundering scheme, allegedly helping two corrupt Kazhak bigwigs hide $40 million in New York real estate.

Kazakhstan’s former capital, Almaty, and BTA Bank JSC, based in the city, made the accusations in claims filed in Manhattan Federal Court Monday.

The accusations center around the former chairman of BTA, Mukhtar Ablyazov, and the former mayor of Almaty, Victor Khrapunov.They allegedly stole over $4 billion through embezzlement and corrupt deals, and then fled the Central Asian nation, Bloomberg reported.

Behind the story:

Chetrit Group

Using a shell company, the pair invested a small part of that money, relatively speaking, in condo conversions at the Chetrit Group and Clipper Equity’s Flatotel at 135 West 52nd Street, and Cabrini Medical Center at 227 East 19th Street, with Chetrit’s help, according to the filing.

The accusations were filed in response to a suit by the Chetrit Group, which asked a judge whether it should pay $21 million to Ablyazov and Khrapunov’s company, or to the city of Almaty, Bloomberg reported.

The Chetrit Group is one of the city’s top developers and investors. The company bought 550 Madison, Sony Corp’s U.S. headquarters, for $1.1 billion in 2013. It also co-owned the Willis Tower in Chicago, before the Blackstone Group bought it for $1.3 billion earlier this year. [Bloomberg]Ariel Stulberg