Investor Fraud in Kazakhstan
Investor Fraud in Kazakhstan: Sham Investment Agreements, Non-Return of Investments and Interest. How to Recover Your Investment in 2026
This publication is prepared by Samal Sagidanov, Attorney-at-Law
25+ years of legal practice, License No. 0000650 dated April 26, 2006
Foreign Judgments Enforcement • Exequatur • Almaty • Astana • Entire Kazakhstan (remote representation available)
If you have questions, contact via WhatsApp: +7 702 847 80 20, email: garantplus.kz@mail.ru
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“These investment disputes are not theoretical. This is my daily legal practice.”
"You may write in any language (Russian, English, or Chinese).
I will arrange the translation myself and provide a legally sound response to ensure you do not lose your assets or capital. Simply message me via WhatsApp or email — I will review your case and get back to you as soon as possible."
A Scenario That Has Become Alarmingly Common in Kazakhstan
Imagine a situation that has become increasingly typical in Kazakhstan in recent years.
You are an investor.
It does not matter whether you are a local entrepreneur from Almaty or Astana, or a foreign investor from the United States, the European Union, the United Kingdom, China, or Russia.
You identify a promising investment opportunity:
a land plot for industrial development, a stake in an operating business, a construction or manufacturing project, logistics infrastructure, or real estate development.
You sign an investment agreement.
You transfer an advance or the full investment amount — often tens or hundreds of millions of tenge (or the equivalent in foreign currency).
You reasonably expect the project to commence.
Time passes.
At first, you are told there are delays.
Then communication becomes irregular.
Eventually, you discover that assets have been transferred to third parties, property has been re-registered, funds withdrawn, and the investment vehicle is effectively empty.
The investment is not returned.
Interest is not paid.
What you are facing is investor fraud and non-return of invested funds.
In many cases, investors later discover that they were not the only ones who invested in the same project.
It is critical to understand from the outset:
this is not a failed business venture.
This is a systemic scheme, and in 2026 such cases are increasingly common in Kazakhstan — both involving foreign investors and disputes between Kazakhstani parties.
When Investments Turn Into a Legal Trap
A typical investment dispute follows a familiar pattern.
An investment agreement or joint activity agreement is executed.
On paper, everything appears compliant.
In reality:
- the investment agreement is drafted formally, without enforceable obligations or real investor protection;
- the investment asset does not legally belong to the counterparty or is distributed among affiliated relatives;
- the land plot or property is encumbered or pledged;
- assets are prepared for withdrawal in advance;
- the company serves as a temporary shell, while real operations are conducted through multiple legal entities or individual entrepreneurs.
As a result, the investor faces a sham or fictitious investment agreement and the practical impossibility of voluntary recovery.
Important
In investment disputes, the decisive mistake is made not in court, but before filing a claim.
Incorrect legal qualification of the investment agreement, choosing the wrong remedy, or missing the window for interim measures often makes recovery impossible — even when the counterparty’s misconduct is evident.
Judicial practice in 2024–2026 shows that most dismissals in investment disputes are caused not by the absence of rights, but by incorrect initial actions taken by the investor.
Common Investor Fraud Schemes in Kazakhstan
Kazakh courts increasingly encounter the following schemes.
1. Sham or simulated investment agreements.
Documents are executed solely to attract funds. The project was never intended to be implemented. Courts often recognize such agreements as fictitious or simulated, while the recovery object is already absent or withdrawn before proceedings begin.
2. Non-return of investments under the guise of entrepreneurial risk.
Defendants argue that investments are inherently risky and therefore non-refundable. Without proper legal classification, courts may accept this position.
3. Asset stripping and transfer to affiliated parties.
Land, buildings, equipment, and shares in LLPs are transferred to related entities. Without timely interim measures, assets disappear irreversibly.
4. Investments in land and construction projects.
The most dispute-prone category. Investors fund land or construction without verifying legal status, permits, or zoning restrictions. Projects become blocked, and recovery turns into prolonged litigation.
5. Escalation of losses through additional funding requests.
After receiving initial investments, the debtor requests additional funds under the pretext of “recovering” the original investment — increasing a debt that was never intended to be repaid.
Why an Executed Contract Does Not Guarantee Investment Recovery
A common misconception among investors is believing that a signed contract automatically guarantees court protection.
In practice, Kazakh courts assess:
- the reality of investment obligations;
- the economic substance of the transaction;
- the moment when the investor became aware of the breach;
- the investor’s actions prior to litigation.
An incorrect pre-trial claim, wrong jurisdiction, or improper legal qualification can permanently deprive an investor of recovery.
How Investments Can Actually Be Recovered in Kazakhstan in 2026
Investment recovery is possible — but only with a properly structured strategy.
Stage One: Immediate legal audit.
The investment agreement, payment trail, correspondence, and asset ownership structure are analyzed. This stage often reveals indicators of a sham investment arrangement.
Stage Two: Interim and injunctive measures.
Asset seizure, prohibition of registration actions, account freezing. This stage is critical: without it, assets can be dissipated within days.
Stage Three: Judicial recovery.
Claims for invested funds, interest, damages, and challenges to asset transfer transactions.
In appropriate cases, parallel criminal-law mechanisms may be initiated if fraudulent intent is established.
Investment Disputes with a Foreign Element
Foreign investors face additional risks: jurisdiction, applicable law, language of agreements, and recognition and enforcement of judgments.
An incorrect jurisdictional decision at the outset often makes recovery impossible.
Practice shows that most errors occur at the very beginning of the dispute, when investors attempt to act independently.
Why Self-Action by Investors Is Dangerous
Attempts to independently submit claims, file lawsuits, or negotiate often lead to loss of evidence, missed limitation periods, and a strengthened position for the debtor.
After an initial procedural failure, courts may block subsequent attempts.
The cost of error in an investment dispute is the total loss of invested capital.
In practice, effective recovery requires a dual-track approach:
negotiations may continue, but legal enforcement mechanisms must be launched in parallel, based on the assumption that voluntary repayment will not occur.
This approach significantly increases recovery prospects.
What to Do If You Invested and Funds Were Not Returned
If your investment has not been returned, the project has stalled, and assets are being withdrawn, it is essential to pause and avoid impulsive actions.
A concise professional legal assessment before filing a claim often determines the entire outcome.
Conclusion
Investor fraud in Kazakhstan is not an exception — it is an established pattern.
Sham investment agreements, non-return of investments or interest require precise, timely, and technically sound legal strategy.
The earlier violations are documented and interim measures applied, the higher the likelihood of preserving assets and recovering funds.
In investment disputes, speed and accuracy prevail over emotion.
If the matter is serious, rely on professional legal representation.
I, Attorney Samal Sagidanov, License No. 0000650 dated April 26, 2006, provide strategic legal assessments designed to secure enforceable outcomes.
email: garantplus.kz@mail.ru
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"You may write in any language (Russian, English, or Chinese).
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