Unlawful pension disbursements in Kazakhstan result in a loss of 399 million for local banks.
In a concerning development, a criminal scheme involving the misuse of pension funds and fake employment information has come to light in Kazakhstan. The scheme, which has been active in at least nine regions of the country, has led to over-indebtedness among many participants.
The fraudulent activities centre around the management of LLP Comfort Time and affiliated enterprises. These organizations registered several legal entities to process fake pension contributions, enabling borrowers to receive loan approvals from multiple banks and thereby increasing their debt burden. By creating false income and solvency information, the scheme was able to mislead banks and facilitate loan approvals.
The problem of over-indebtedness due to such schemes is a serious concern. Most borrowers were unemployed individuals and those with negative credit histories, who were lured into the scheme with the promise of easy loans. However, many of these individuals have since avoided fulfilling their obligations to banks.
The Department of the Financial Monitoring Agency (AFM) in Almaty is investigating a case of property damage caused by this fraud. The investigation is ongoing in eight regions of the country, aside from Almaty where it initially started. The investigation is focused on uncovering the extent of the fraud and its impact on the financial sector.
Kazakhstan's criminal law imposes up to three years imprisonment for creating financial pyramids (Article 217 of the Criminal Code). The Administrative Violations Code also fines perpetrators involved in advertising fraudulent schemes up to 600 MCI.
The Agency of the Republic of Kazakhstan for Financial Monitoring (AFM) and the Agency for Regulation and Development of the Financial Market (ARDFM) publish lists of suspected financial pyramids and fraudulent organizations, providing public warnings and receiving reports from citizens. They emphasize that early detection and reporting to law enforcement or regulators help combat fraud.
The Unified National Pension Fund (ENPF) warns about scammers offering fake assistance for withdrawing pension savings. Official pension withdrawals are strictly regulated and only allowed for specific reasons such as housing purchase, medical treatment, or disability.
Similar pension fraud cases have led to regulatory interventions internationally, such as the UK’s Pensions Regulator taking strong action against fraudsters controlling pension schemes. This underscores the importance of swift regulatory response and whistleblower involvement.
In summary, Kazakhstan combats pension fund fraud through investigative measures led by law enforcement and financial monitoring agencies, underpinned by legal provisions against financial pyramids and fraud. Public awareness campaigns, official blacklists of suspicious firms, and strict controls on pension withdrawals form key elements of this defense against pension-related financial crimes.
Read also:
- Foreign financial aid for German citizens residing abroad persists
- "Germany appears less environmentally friendly compared to Texas, according to Harald Lesch's climate documentary"
- Investing 1 billion funds into the police force of North Rhine-Westphalia for battling rodents and mold issues
- Tesla resurrects transferred Full Self-Driving feature amid other promotional offers
