Freedom Holding's Timur Turlov calls charges brought by Russia’s Deposit Insurance Agency against him 'absurd'

The Deposit Insurance Agency of Russia (DIA) brought criminal charges against Freedom Holding Group Chairman Timur Turlov, according to which the latter withdrew assets from the Russian Assotsiatsiya Bank, whose license had been revoked in 2019. Turulov talked with the Kazinform News Agency correspondent about the charges brought against him.

What was your reaction to the news that the DIA brought charges against you regarding embezzlement of funds from Russia's Assotsiatsiya Bank?

If I’m not mistaken, these charges relate to events from eight years ago. For me, this situation seems to be absurd. It’s common during bankruptcy, when attempts are made to unwind all deals without going into details. 

To note, the Bank of Russia revoked the license of the joint-stock company Assotsiatsiya Commercial Bank in 2019 due to the fact of the absence of foreign currency balances on nostro accounts in the amount of over 3.8 billion rubles (KZT18.6bn) was reflected in the reporting. The amount exceeded the Bank’s own funds almost twice . 

Have you already seen the materials of the case?

I have not yet familiarized with the content of the charges the Agency brought to the arbitration court. We’ve requested the relevant information. Hope that our lawyers will get familiarize with the content of the charges in the near future.

Have you been in any way affiliated with the Assotsiatsiya Bank?

No, I’ve never been affiliated with this bank, and I don't know anyone from it.

Then, how come charges on assets withdrawal were brought against you? 

You know, it seems as an attempt to bring charges against all companies that made any deals with the bank, claim property collection from these companies, without understanding what actually happened there. For me, any charges on asset withdrawal sound really strange. From what I can tell, the only transactions between our company and the bank were of well-known counterparty relations between treasuries conducted exclusively on the market terms. I repeat once again, I’m not aware of any special deals or any involvement in the bank’s operation from our part. Even if there were any transactions, they were very insignificant and do not correlate with the charges brought against me.

You’ve said that these charges relate to the events of eight years ago. As far as I know, you were residing and working in Kazakhstan at the time? 

Yes, I’ve been living in Kazakhstan since 2011 and our business is headquartered here. I began applying for the citizenship prior to the escalation of the geopolitical situation in the world. We focus on developing our business in Central Asia, Europe and the U.S. and we've already left the Russian market. In fact, I’m very proud of being a Kazakhstani national now. My home is where most of my friends and clients are. I call Kazakhstan my home for many years. Here, our company has become one of the major digital eco-systems in Kazakhstan providing services to almost four million unique clients. Freedom Holding Group employs around 10 thousand people, and I can say with confidence that it is a huge and talented team of professionals.

Do you think that these charges can negatively affect the company's activities, especially with European and American partners?

Our company fully complies with the international norms and passed a full audit on the ESGAP and РSOB international standards, which are American public companies. It’s the strictest form of reporting, full disclosure of information in the entire region, according to which our company discloses ways we interact with different clients and how we follow the sanctions. In addition, the Board of Directors of Freedom Holding Group ordered an audit from Forensic Risk Alliance and Morgan, Lewis & Bockius LLP, which are among respectable companies and provide forensic examinations for international commissions on securities. Here, we also received positive assessments on the standard of conduct, culture of compliance and reporting.

Can you guarantee that the funds of your clients are safe in light of the charges from the Deposit Insurance Agency?

We’re confident that during arbitral proceedings we will manage to define the amount of accusations and prove our good faith. We cannot see any damage to the interests of our clients, including the fact that our business is not connected with Russia in any way. Moreover, we can see very good opportunities for growth as our company is one of the two companies in Kazakhstan and the entire Central Asian region which did detailed information disclosures.