Kаzаkhgаtе refers to the scandal surrounding James Giffen, an American businessman and former advisor of Kazakhstan president Nursultan Nazarbayev[1]. US prosecutors accused Giffen of bribery paid to Nazarbayev and Nurlan Balgimbayev, former Prime Minister of Kazakhstan, to secure contracts over the Tengiz oil fields for Western companies in the 1990s.[2] James Giffen was arrested in 2003 at John F. Kennedy International Airport in New York while attempting to board a plane to Paris, though in doing so it was later learned he was in no way attempting to flee the country. He had a return ticket and it was a normal planned business trip. He was charged by the US attorney's office of the Southern District of New York with violation of the Foreign Corrupt Practices Act of 1974 and with money laundering[3]. He was carrying a Kazakhstani diplomatic passport, though dual citizenship is not allowed by the laws of Kazakhstan. The attorney's office also charged J. Bryan Williams III, a former Mobil executive, with tax evasion relating to kickbacks from Mobil's business in Kazakhstan.
According to the federal bribery charges, Giffen is accused of creating Swiss bank accounts and transferring $20 million[4], paying tuition at exclusive boarding schools for family members of Kazakh officials, and buying millions of dollars in jewelry. Giffen's lawyers assert that Giffen was acting with the full knowledge and approval of the US government. Giffen has requested access to classified information at his trial to back up his claims. The government has opposed the revelation of classified information.[5] In August 2010 Giffen pleaded guilty in front of federal court in Manhattan, N.Y. in disclosure of a Swiss bank account on his income tax return. Mercator Corporation which is owned by Giffen pleaded guilty to one count of making an unlawful payment to a senior government official of the Republic of Kazakhstan, in violation of the Foreign Corrupt Practices Act. [1]
Mercator faces a maximum fine of the greater of $2 million or twice the gross gain or loss resulting from the offense. Giffen faces a maximum sentence of one year in prison and a fine of up to $25,000.
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Kazakhstan officially said that the charges have nothing to do with their country as they concern an American citizen, though several American attorneys addressed the US Department of Justice on behalf of Kazakhstan[6]. They requested to stop the proceedings taking into account the strategic importance of US relations with Kazakhstan.
According to the Financial Times, James Giffen is referenced by former CIA agent Robert Baer in his book "See No Evil" as "Mr. Kazakhstan" for his ability to influence oil policy in that country. George Clooney produced the film "Syriana" based on this book. Tim Blake Nelson played the role of Giffen.