Update, July 18: A trusty source close to Washington tells EurasiaNet.org that Economics Minister Temir Sariev’s allegations are “way off” and characterized him as a “populist” with an unclear agenda. But someone is going to be very unpopular when that money doesn’t come home. Stay tuned.

The son of Kyrgyzstan’s deposed dictator might be living a cushy life in the United Kingdom, but money he stashed in the United States is reportedly now sitting behind bars.

Russia’s Kommersant daily, citing Kyrgyzstan’s Economics Minister, reported on July 17 that Washington has frozen three of Maxim Bakiyev’s American bank accounts, which held $74.4 million.

Bakiyev is the son of former President Kurmanbek Bakiyev, who was ousted amid street violence in April 2010. The younger Bakiyev, who fled to the UK, was known in Kyrgyzstan as the “prince” for parlaying his father’s influence into lucrative and opaque business deals. To this day, in Kyrgyzstan he might be more reviled than his father. In March, a Bishkek court found the younger Bakiyev guilty in absentia of embezzling over $100 million in state funds. He received a 25-year prison sentence.

Late last year, the Department of Justice tried to extradite the younger Bakiyev from London to the United States to face charges of conspiracy to commit securities fraud and obstruction of justice. An affidavit, filed last April in the US District Court for the Eastern District of New York, appeared to finger Maxim as “co-conspirator #1” in an insider trading case involving US securities. (The affidavit did not name Maxim Bakiyev.)

But this May, the US suddenly dropped the extradition case. US Ambassador to Kyrgyzstan Pamela Spratlen is on record saying prosecutors lacked evidence. The news was a major disappointment in Kyrgyzstan, where, though few expected the West to extradite him home, many were comforted by the thought of Maxim facing jail time somewhere. Kyrgyz have watched with dismay as the Bakiyev family has scattered and, for the most part, avoided justice. The senior Bakiyev is living openly in Belarus – frustrating Kyrgyz officials and souring relations.

The US Embassy in Bishkek was unable to respond to a request for comment about the Kommersant report on July 17. But, if the report is confirmed, it offers some small measure of justice for Kyrgyzstan and suggests an investigation into Bakiyev’s activities continues in the US. The news will likely prompt calls for the funds to be returned to Kyrgyzstan, where they would make up 4 percent of the impoverished country’s 2013 national budget.

From Kommersant:

The government of Kyrgyzstan is saying that the American decision [to freeze the assets] is the first step toward returning the assets that were taken out of the country during Kurmanbek Bakiyev’s presidency. A working group under the Kyrgyzstan’s Prosecutor General’s office was created last week, which, together with the US law firm “Akin Gump,” will resolve this issue. “We have sent a request to the US asking them to provide us with the information about Maxim Bakiyev’s financial assets.

The Latvian and British governments have received similar requests from us,” First Deputy Prosecutor General Temirbek Bekmamat uulu told Kommersant. Kyrgyz investigators claim that Maxim Bakiyev placed most of his funds in Latvian banks, and now the former “prince’s” money is being managed by his classmate Alexey Eliseev, who escaped to the Balkans after the revolution in 2010.

Together with the attempts to return the assets that were illegally taken out of the country, the Prosecutor General’s office is conducting an investigation into the forcible seizures of large Kyrgyz enterprises and banks by Maxim Bakiyev. For example, Issyk-Kul Invest Bank, Kyrgyz [Investment and] Credit Bank, Asia Universal Bank and the branch office of Kazakh BTA bank were under control of the ex-president’s son. According to the [Prosecutor General’s] investigation, these banks were used for money laundering. “Maxim Bakiyev turned Kyrgyzstan into an offshore zone,” says Temirbek Bekmamat uulu. According to his calculations, companies that are registered in the British Virgin Islands, Gibraltar, Panama and New Zealand have laundered billions of dollars from Asia Universal Bank alone.

This week, President Almazbek Atambayev furiously lashed out at Britain, telling The Guardian newspaper that London is “cynical and corrupt” for “hosting a guy who robbed us.”

“Why are there double standards against Kyrgyzstan? Britain is saying: ‘We want to help with democratic development in Kyrgyzstan.’ That’s a lie. You’re hosting a guy who robbed us,” Atambayev said. “I didn’t know that behind the beautiful words of democracy are very dirty lies. That’s terrible. Britain is one of the founders of democracy and it’s impossible to understand its actions against us. I am ashamed for Great Britain and didn’t expect politics to be this cynical and corrupt.”

http://www.eurasianet.org/node/67263