Anticorruption officials in Kyrgyzstan say they have exposed a $58 million money laundering operation — the largest ever seen in the country’s history.
The graft-fighting department at the State National Security Committee (GKNB) said on January 20 that the cash was laundered by a construction company called LLC Berkut Stroi, which they said was based in the southern city of Osh.
The GKNB say two employees of a commercial bank in Osh, Amanbank, registered the construction company in the name of Kanybek M. They then opened bank accounts in Amanbank and another bank, Rosinbank.
The next step was to sign bogus contracts for the purchase of construction materials from companies in China and Latvia, to which the 4.4 billion Kyrgyz som ($58 million) were transferred between January and October 2014. Meanwhile, tax records at Berkut Stroi reflected no economic activity.
Latvia has become a favored destination for laundered funds. In 2012, Latvia was at the center of a major scandal after reporters from Russian newspaper Novaya Gazeta and the Organized Crime and Corruption Reporting Project found that lenders in the Baltic nation were recipients of millions of dollars laundered from tax refunds from the Russian budget.