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Kazakhs Accuse Ex-Uranium Boss Of Money Laundering

Mukhtar Dzhakishev

Mukhtar Dzhakishev

ASTANA (Reuters) -- Kazakhstan today accused a former uranium tycoon of money laundering and said its security service had launched a new criminal probe into his affairs in a case that has shaken confidence in the Central Asian state.

One of Kazakhstan's most prominent business figures, Mukhtar Dzhakishev was arrested last year on accusations of corruption, theft, and illegal sales of uranium assets to foreign companies.

"It's a new case which has been opened within the framework of an ongoing investigation," said Nurdaulet Suyundikov, a Prosecutor-General's Office spokesman.

Dzhakishev's case, along with a string of other high-profile arrests in the former Soviet state and world No. 1 uranium producer, has fueled speculation of an intensifying power struggle within the political elite.

Kazakhstan, hit hard by global economic slowdown, wants to attract fresh foreign investment as well as bolster the role of the state in strategic industries such as uranium and oil.

It has also alarmed human rights groups who have questioned Kazakhstan's methods of fighting corruption in a country where President Nursultan Nazarbaev, in power for two decades, tolerates little political dissent.

Some diplomats have drawn parallels between Dzhakishev and the 2003 demise of Russia's Mikhail Khodorkovsky who is now serving an eight-year prison sentence for fraud and tax evasion after a trial Kremlin critics say was politically motivated.

Dzhakishev, who was head of state uranium major Kazatomprom from 1998 until his arrest, has denied all accusations.

"It is obvious that I cannot count on justice in my own country and my fate has already been decided," he wrote from his detention center in a letter published by his lawyers this week.

"But I want to tell the people of Kazakhstan that I am innocent," added Dzhakishev who played a key role in turning Kazatomprom into a major global uranium player.

His arrest left Kazatomprom's foreign partners such as Canada's UraniumOne worried about the future of their projects. Other investors include France's Areva and Japanese companies such as Toshiba Corporation.

Closed-door court hearings into earlier allegations of theft and corruption have already started and lawyers expect a verdict as soon as this month.