By Kirstin Ridley
LONDON (Reuters) - Mukhtar Ablyazov, a Kazakh oligarch accused of embezzling at least $5 billion from one of Kazakhstan's largest banks BTA, has been sentenced to 22 months in jail in Britain for contempt of court.
High Court Judge Nigel Teare said on Thursday Ablyazov had lied in a deliberate, substantial and brazen way about his ownership of companies and property as well as dealing with assets in breach of a worldwide freezing order.
"The seriousness of Mr Ablyazov's conduct, in my judgment, requires immediate custody," he told the court on Thursday, adding that an arrest warrant would be issued.
The 49-year-old billionaire, who denies allegations he says are designed purely to eliminate him as an opponent to Kazakh president Nursultan Nazarbayev, did not attend court, prompting speculation by BTA's counsel he might be fleeing.
"If we're right, we need that (arrest) warrant as soon as possible so we can alert ports and airports," BTA's counsel Stephen Smith stated. He asked for confirmation Ablyazov's passports and travel documents, which have been confiscated by the court, were in a secure location.
Ablyazov's counsel Duncan Matthews said there was no indication his client was attempting to leave Britain. But he conceded Ablyazov had felt it would not be in his interest to show up in court. "I'm not suggesting he's indisposed with a mild head cold," he said.
Handing down a near maximum sentence for contempt of court, Teare said Ablyazov might win partial reprieve if he admitted to wrongdoing, including admitting to his ownership of assets that include a mansion on The Bishops Avenue, London's premier billionaire's row.
But he said Ablyazov should spend at least 12 months behind bars.
Ablyazov's lawyer argued he would be both in personal danger in jail as well as less able to battle nine separate fraud charges launched by BTA'a current management -- controlled by Kazakh sovereign wealth fund Samruk-Kazyna.
"He is very disappointed with the result," Ablyazov's London-based spokesman said. "He maintains that this whole thing is politically motivated and that he has complied with all aspects of the freezing order and will be appealing this judgment."
Ablyazov noted drily in an interview in January that any jailing would come a decade after he was imprisoned and tortured on what he calls trumped up corruption charges in Kazakhstan.
But he said his life in London was pretty much like a jail-term anyway.
"I am either in the office or at home. It's not dissimilar to a prison," he told Reuters in an interview translated by Roman Solodchenko -- the former chief executive of BTA, the Kazakh bank Ablyazov once controlled -- now also in exile here.
Dividing his time between his plush office in the clouds in Tower 42, a landmark skyscraper in London's financial centre, and lavish property in north London might not seem particularly onerous.
But smooth-talking and often humorous Ablyazov said he regretted coming to London, where he has focused his efforts on battling lawsuits -- and where he has been granted political asylum because, he says, of the continued threat of attack due to his support for regime change at home.
"I think England was a mistake," he says. "I provided jurisdiction for (my enemies) to attack me. And I thought better about the judicial system previously. Unfortunately, the English seem to have limited understanding for what Kazakhstan is...
"Judges don't understand why you might want to hide ownership of assets. To control the ownership of BTA, I had to use a very sophisticated structure so Nazabayev wouldn't know I owned it. In a way, Kazakhstan is a different civilization."
The contempt of court case was brought by BTA to prevent Ablyazov from dissipating his assets. But the first three fraud claims from the main case are expected to be heard around November, although the latest judgment in this complex case could delay the main case further.
Teare has said Ablyazov's voluminous evidence paints a "chilling picture" of life in Kazakhstan, where power resides with the president and his entourage and dissent is eliminated. "His evidence suggests that Kazakhstan has much in common with Ancient Rome," he noted last year.
But he dismissed attempts to strike out claims against Ablyazov and his partners as being politically motivated.
Brimming with natural resources such as oil, gas, gold and uranium, Kazakhstan's steppes stretch from the Caspian Sea to the Chinese border in a sparsely inhabited country the size of western Europe -- fine pickings for those with the power to extract its riches.
Ablyazov is a former government minister whose portfolio of assets has been valued by one English judge at around 5 billion pounds ($8 billion). But he was imprisoned in 2002, one year after his "increasing disenchantment" with Nazarbayev's authoritarian rule prompted him to found the pro-business opposition party, the Democratic Choice of Kazakhstan (DCK).
Pardoned one year later, he spent two years in exile in Russia before returning to Kazakhstan under an amnesty with Nazarbayev to lead BTA from 2005 until 2009, when he fled to London after BTA was declared insolvent and Samruk-Kazyna took control.
"We welcome this important step forward in the asset recovery process and the litigation against Mr Ablyazov," BTA Bank's first deputy chairman Nikolay Varenko said in a statement after the judgment was handed down.
"We believe strongly that imprisonment will limit his ability to dissipate assets, encourage him to reverse the improper disposal of assets that he has already made and disclose assets that he has tried to hide from the Bank."
(Reporting by Kirstin Ridley. Editing by Jane Merriman)