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The CIA made me do it: understanding the political economy of corruption in Kazakhstan

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Abstract

This article focuses on a widely publicized criminal prosecution recently completed in the U.S. District Court in New York City. It features an oil broker by the name of James Giffen who is accused of paying bribes totaling as high as $84 million dollars to high-ranking members of the government in Kazakhstan. This includes the President, the Prime Minister, and a former oil minister. Mainstream criminology tends to see these perpetrators as individual evil-doers who exploit opportunity structures, rational-choice purveyors of greed, or even as persons who experienced problems of social attachment as young people. To the contrary, this paper suggests that the pattern is firmly grounded in the geo-politics of oil in central Asia, in which governments and their multi-national oil companies are jockeying for lucrative oil reserves. In the instant case, there was circumstantial evidence that both the CIA, State Department, and even the Clinton White House knew what Mr. Giffen was doing in Kazakhstan, and looked the other way – so as to favor American, multi-national oil companies seeking low-cost oil leases from the Kazakhstan government.

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Notes

  1. The public case is United States v. James H. Giffen, U.S. District Court, Southern District of New York (Foley Square). No. 3:03-CR-00404-WHP-1. All references will be to this file unless otherwise noted.

  2. The Government declined to image the vast discovery onto CD-Roms, as it claimed it would cost $1 million dollars.

  3. The case Number is 03 MAG. 663. Following this Magistrate’s complaint, a grand jury issued a formal indictment. That Indictment has been superseded three times in total, and contains further details of other transactions in which Mr. Giffen is alleged to have sent illegal payments to Kazakh officials.

  4. US. v. Giffen, Memorandum of Law of the U.S. in Opposition to Defendant’s Pretrail Motions, filed April 15, 2004 [40]. p.4. Later on, the Government alleged a third official was bribed: Prime Minister Akezhan Kazhegeldin. See Government’s Motion in Limine, filed November 29, 2005 and unsealed. p.3. See also Second superseding Indictment, filed August 4, 2004, Docket #44.

  5. U.S. v. J. Bryan Williams, No. 03-CR-406-HB-1 (U.S.D.C., S.D.N.Y.). On September 18, 2003, Mr. Williams was sentenced to 46 months imprisonment, 3 years of supervised release, a criminal fine of $25,000 and a restitution order to the IRS of approximately $3.5 million dollars.

  6. Transcript of April 4, 2003 hearing, US v. Giffen, filed June 3, 2003, p.3.

  7. US v. Giffen, Transcript of September 5, 2003, p.14.

  8. U.S. v. Giffen, Memo of Law re Motions, March 16, 204, p. 1–2.

  9. US v. Giffen, Memorandum of Law of the U.S. in Opposition to Defendant’s Pretrail Motions, filed April 15, 2004. Exhibit A. see http://www.state.gov/g/drl/rls/hrrpt/2000/eur/798.htm.

  10. US v. Giffen, Reply Memorandum of Law in Support of Defendant James H. Giffen’s Pretrial Motions, filed May 10, 2004, p. 8.

  11. The list of officials in contact with Mr. Giffen is revealing. They include CIA Director Robert Gates, Deputy CIA director John McGaffin, NSC official Brent Scowcroft, Toby Gati, Department of State Secretary James Baker, Ambassadors William Courtney and John Wolf, and Mr. Leon Furth from the White House. Exhibit D. US v. Giffen, Reply Declaration of Kevin Galbraith in Support of Defendant James H. Giffen’s Pretrial Motions. See also Transcript of court hearing, June 3, 2004, p. 59.

  12. US v. Giffen, Reply Declaration of Kevin Galbraith in Support of Defendant James H. Giffen’s Pretrial Motions, Filed May 10, 2004.

  13. US v. Giffen, Transcript of court hearing, June 3, 2004, p. 57.

  14. US v. Giffen, Memorandum and Order, filed July 6, 2004, Docket Entry #39, p. 8.

  15. US v. Giffen, Memorandum and Order, filed July 6, 2004, Docket Entry #40, p. 19.

  16. US v. Giffen, Order filed November 12, 2004, U.S. District Court, S.D.N.Y., p. 2.

  17. US v. Giffen, Memorandum and Order filed December 2, 2004, p.5.

  18. Letter to Judge W.H. Pauley by W.J. Schwartz, dated August 16, 2004, p. 3.

  19. US v. Giffen, Transcript of February 16, 2005, Docket #95, p. 8.

  20. U.S. v. Giffen, Government’s Motion in Limine, filed November 29, 2005, Docket #110, Attachment.

  21. Former Panamanian strongman Manuel Noriega was a highly paid CIA asset and collaborator, despite knowledge by U.S. drug authorities as early as 1971 that the general was heavily involved in drug trafficking and money laundering. Indeed, on behalf of the U.S. government, Noriega facilitated "guns-for-drugs" flights for the Contras, providing protection and pilots, safe havens for drug cartel officials, and discreet banking facilities. The U.S. government only turned against Noriega, invading Panama in December 1989 and kidnapping the general, once they discovered he was providing intelligence and services to the Cubans and Sandinistas. Ironically, drug trafficking through Panama increased after the U.S. invasion [5, 22, 29].

  22. US v. Giffen, Defendant James Giffen’s Memoradum of Law in Opposition to the Government’s CIPA Section 6 Motion in Limine, filed November 29, 2005, Docket #111, p. 2.

  23. US v. Giffen, Order filed October 12, 2005, Docket #103, U.S.D.C., S.D.N.Y. Portions of this Order were later unsealed and filed with the Court on January 18, 2006, Docket #127.

  24. Filed as United States v. Giffen, Case 05-5782-CR, filed October 25, 2005 in the U.S. Court of Appeal for the Second Circuit, New York.

  25. US v. Giffen, Transcript of October 27, 2005. Docket#105. p. 8.

  26. US v. Giffen. Transcript of Hearing, December 14, 2007, p. 6. This admission contradicts the Government’s previous statement that there was no Brady material. See fn.#11.

  27. US v. Giffen. Transcript of Hearing, September 5, 2008, p. 5.

  28. US v.. Giffen, Transcript of Hearing, December 10, 2008, p. 14. Later, the Government proposed that counsel for Mr. Giffen identify which documents he might actually wish to read. The Government would then return to the security agency to determine whether the material could then be specifically released to Mr. Giffen.

  29. US v. Giffen, Order of April 22, 2009, filed April 23, 2009, Docket #191.

  30. US v. Giffen, Transcript of Proceedings, August 6, 2010, Docket No. 209, p. 37. Giffen claims he never really had title to these funds in the first place.

  31. US v. Giffen, Letter from Counsel William J. Schwartz, dated November 12, 2010; filed November 23, 2010 as Docket Entry #215.

  32. US v. Giffen, Judgment, Docket No. 214, filed November 23, 2010.

  33. US v. Giffen, Reasons for Sentence, Transcript of November 19, 2010. Docket #220, p.12.

  34. US v. Giffen. See Government’s Motion in Limine, filed November 29, 2005 and unsealed. pp.3-4. Docket No. 110.

  35. US v. Giffen. Letters in support of James H. Giffen, filed November 23, 2010, Docket No. 218, p.2.

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  1. King’s University College, University of Western Ontario, London, Ontario, Canada

    Matthew G. Yeager

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Yeager, M.G. The CIA made me do it: understanding the political economy of corruption in Kazakhstan. Crime Law Soc Change 57, 441–457 (2012). https://doi.org/10.1007/s10611-011-9341-2

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