Major lawsuit brought against Iraqi Kurdistan government-linked company: documents

Editorial | Exclusive to iKurd.net
By Sheri Laizer

HEWLÊR-Erbil, Iraq’s Kurdistan region,— Sarbaz Hawrami named in fraudulent dealings with Stati Party Moldovan-Romanian companies in Swedish case promulgated on November 25, 2019, a document by Ministry of Justice of the Republic of Kazakhstan revealed.

Stati Parties, close to the Kurdistan Government have been investigated.

In a 2008 document it was shown that among many other transfers, huge sums of money had been sent to Iraqi Kurdistan disguised as ‘investments’, leading to creditors losing hundreds of millions.

New documents show that the companies, KPM and TNG, already had economic problems and an extensive financial deficit before the autumn of 2008. The reason for this was that KPM and TNG did not receive payment for the oil that was delivered to the affiliated companies, and that the funds intended for KPM and TNG were used in order to finance projects abroad, including in Kurdistan and Moldova. [1]

The difficulties subsequently arising were not a result of an acceptable assumption of commercial risk but, rather, an immediate consequence of a long-standing, extensive and systematic criminal operation by the Stati Parties…This operation involved transferring substantial value from, or intended for, the Kazakh businesses to Anatolie Stati and Gabriel Stati’s businesses in other countries. The looting was completed and concealed through complicated arrangements that generally included affiliated companies and fictitious transactions in several stages.2

The company had used its funds to acquire assets in Kurdistan and Moldova, which was why Tristan Oil could not pay the monies owed to KPM and TNG. [3]

Millions were diverted into private accounts under numerous company names fronted by the Statis and ‘straw men’ that did not exist… As part of this, the Stati Parties transferred a total of USD 61 million to Hayden between June 9 and July 3, 2008. Once the money had been received by Hayden, the Stati Parties used these funds for projects in other countries, for luxury goods and consumption, and to make payments to politicians and state employees, including the Hawramis.

The pattern continued for several years with millions of dollars of investor money and bank credits being diverted, false financial reports being provided and inflated investment costs shown, as well as sham transactions, including through the use of straw men named as the Perkwood company. Money taken out of TNG, for example was never paid back. [4]

The documents to which Kazakhstan has obtained access show that the funds of which KPM and TNG were deprived were transferred to Hayden, among other things, in order then to be used for luxury consumption and to make payments to politicians and state employees abroad, including Kurdistan. [5]

Among other things, the Stati Parties channeled large sums of money from Hayden to countries in the Middle East, but mainly Kurdistan. By way of example, it may be mentioned that the Stati Parties, between June 9, 2008 and July 3, 2008, transferred USD 39.8 million to the account of the company, Pellat International, which is controlled by Anatolie Stati, at Rietumu Banka.186

Top Kurds keeping bad company

The money originated from Montvale and consisted of the oil payments from Vitol which have been described in section K.3.2.5.187 Pellat International, in turn, transferred USD 32 million to Calgary Trade Inc which has connections to the United Arab Emirates, as well as USD 7.8 million to Zozik Co which has connections to Kurdistan.188 
6

Komet Group S.A is Anatolie Stati’s operative company in Kurdistan. Both Lenwell Solutions Inc. and Komet Group S.A., over whose bank account Anatolie Stati has a right of disposition,192 have bank accounts at Rietumu Banka.

From Komet Group S.A., the Stati Parties later transferred the money to a company which is connected to the Kurd government, Zozik Co. The payment reference states “PSC dated 20.06.2008” which would pertain to payment under a Production Sharing Contract (PSC) dated 20 June 2008 related to Anatolie Stati’s operation in the Barda Rash oil field in Kurdistan.

On June 16, 2008, the Stati Parties transferred USD 11.5 million from Hayden to Lenwell Solutions Inc, after which this money was transferred to the Komet Group S.A.193 The money originated from Terra Raf.

From Komet Group S.A., the money was transferred to the company, Ocean Energy FZE.194 At this time, Kazakhstan does not know who owns Ocean Energy FZE, but the totality of circumstances points to the fact that the company has connections to the Kurdish government since payments to Ocean Energy FZE were made by order of the Kurdish government (which issued payment instructions to Anatolie Stati). The payment references for the transfers to Ocean Energy are “article 32 of the production sharing contract” and “letter of 13 June 2008”.195

The former would pertain to payment in accordance with the Production Sharing Contract which is described in paragraph 207 above. The latter appears to relate to a letter from the Kurdish government dated 13 June 2008. The letter was addressed to Anatolie Stati and contained payment instructions for payment to Ocean Energy FZE.196 [7] This letter emanating from the Kurdistan government’s Ministry of Natural Resources was under the helm of Ashti Hawrami and is referred to in statement of the Government of Kazakhstan’s claim at footnote 196, attached to the claim itself as exhibit K-86. [8]

This letter shows a sum being paid to Ocean Energy FZE and as more pertinent than the bribes paid to Sarbaz Hawrami specified in a separate section, as below. This shows how money was being stolen from the Kurdish nation. 

The Stati Parties also used funds from Hayden to pay several million dollars to politicians and state employees in Kurdistan, Moldova, Congo, Romania, and Sudan. The money originated from funds over which the Stati Parties’ Kazakh operation, i.e. KPM and TNG were deprived. [9]

Exhibit K-99 referred to in footnote 226, shows how Sarbaz Hawrami spent this money on the consumption of luxury goods and casinos.10 With regard to Sarbaz Hawrami the litigation observed” in a heading ‘The Stati Parties made payments to Sarbaz N Hawrami’ that between September 2010 and February 2013, 8 transfers were made by the Stati Parties via Hayden to Sarbaz N, Hawrami’s bank account at Rietumu Bank.

There is conflicting information regarding which position was actually held by Sarbaz N Hawrami in the Kurdish government, i.e. some information indicates that, inter alia, he is a consultant and staff manager with Kurdistan’s Prime Minister.221 [11] Several sources describe him as a manager of petrol and oil refineries in Kurdistan. 222

Benefits to Sarbaz N. Hawrami

During the period September 2010 to February 2013, Anatolie Stati, by means of money transfers from Hayden’s bank account at Rietumu Banka, appears to have provided undue benefits totalling USD 1,503,260 to Sarbaz N Hawrami who, at that time, was engaged with the local government in the Kurdistan region of Iraq. The inappropriate benefits consisted, inter alia, of monetary benefits. [12] [13]

The total amount transferred by the Stati Parties via Hayden to Sarbaz Hawrami was approximately USD 1,5 million.223 To put the amount in perspective, it has to be noted that the average monthly income in Kurdistan is approximately 420 USD.224 It is apparent from the bank statements that the transactions related to “bonuses and salary payments” as well as “payment as per request; for representative fee”.225

At the same time as the Stati Parties claimed that the companies in Kazakhstan were in financial crisis, the Stati Parties used KPM and TNG’s income for luxury consumption. Instead of letting KPM and TNG receive the oil revenues and reinvest them in KPM and TNG and thereby help the companies out of the serious financial crisis in which they found themselves, the money was used for travel by private jet, watches and luxury cars like the latest model BMWs. Currently, Kazakhstan is aware that at least USD 1.1 million were used for luxury consumption between August 2, 2007 and October 22, 2008. This amount will likely rise as Kazakhstan reviews the documents now in its possession. [14]

The crimes of ‘careless disregard for creditors’, ‘gross swindling’ and ‘disseminating misleading information’, ‘gross tax crimes’, ‘gross bookkeeping crime’, ‘gross fraud’ and ‘money laundering’ inter alia are invoked.

The claim lays out that Anatolie Stati “committed the acts with intentional indifference”. His Kurdish partners are equally culpable.

Rietumu Banka is known for its involvement in extensive money laundering schemes. [15]

During the period from July 2007 until July 2010, Anatolie Stati has thus transferred through bank accounts under his control a total of USD 191 million which was derived from criminal activities.16 


In addition to various luxury purchases, Anatolie Stati paid hundreds of thousands of dollars to politicians and politically exposed persons in Moldova, the Democratic Republic of the Congo, Romania, Sudan and Kurdistan (see, further, section L.3-L.4). Anatolie Stati also channeled money abroad (section L.2 above). By means of the transfers to Hayden, Anatolie Stati has attempted to hide the fact that the money originates from criminal activities and that he has also made it possible for him, or other parties designated by Anatolie Stati, to obtain the funds. [17]

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