We continue to follow the story of how natural resources are acquired under the guise of philanthropy.
CHAPTER 2
The Transfer
BILL'S EXCELLENT KAZAKH ADVENTURE
On September 6, 2005, former president Bill Clinton found himself, of all places, in Almaty, Kazakhstan. with broad steppes and rugged mountains, Kazakhstan was a place where Genghis Khan once roamed. More recently, the comedy film Borat lampooned it as an impoverished country full of incompetents. In truth, however, the country sits atop a vast storehouse of minerals that includes an estimated $5 trillion worth of natural resources. Highly prized are the country's immense uranium deposits-the mineral used to fuel nuclear reactors and build nuclear bombs.
Bill Clinton's Kazakhstan sojourn was ostensibly an effort to help the country's HIV/AIDS patients gain access to lower-priced antiretroviral therapies. Yet according to the World Health Organization (WHO) and the United Nations Program on HIV/AIDS, at the time of Clinton's visit, only an estimated fifteen hundred Kazakhs needed such treatments.
In 2005 the prevalence of HIV/AIDS in Kazakhstan accounted for between 0.1 and 0.3 percent of its 15.4 million citizens, low compared with African countries like Botswana (24.1 percent) and South Africa (18.8 percent of adults). All the more curious was the fact that Clinton had agreed to public and private meetings with the nation's dictator, Nursultan Nazarbayev, who had ruled Kazakhstan as president since 1990.
Nazarbayev and Clinton.
Having risen through the ranks of the Communist Party during the Soviet days, Nazarbayev dropped the working-class rhetoric after the collapse of the Soviet Union and reverted to a classic despot. Indeed, "president" was a selected title. Kazakhstan doesn't have elections as we think of them in the West.
Nazarbayev regularly wins reelection with more than 90 percent of the vote. (In the last election, the candidates running against Nazarbayev claimed they voted for him.) In short, Nazarbayev gets what he wants, one way or another. Despite a long marriage and an airline stewardess for a mistress, he was the father of only three daughters-no sons.
Lacking a male heir, he arranged a relationship with the former Miss Kazakhstan Assel Issabayeva, and impregnated her via test tube. On April 2, 2005, she gave birth to his Sultanchik. Problem solved. According to the Huffington Post, "Nazarbayev himself is rumored to be one of the richest men in the world, although no one knows exactly how rich, since he is alleged to have hidden interests in a variety of businesses."
Kazakhstan's five billionaires all have close ties to Nazarbayev. Two of them are his relatives. Nazarbayev craves acceptance from the West. But he has a nasty habit of throwing political opponents and journalists into jail. Torture is common. The list of Kazakh human rights viola- tions, according to the US government, besides torture includes arbitrary detention; restrictions on freedom of speech, press, and assembly; pervasive corruption; and human trafficking.
So why would former president Bill Clinton bestow an air of international respectability on a backwater billionaire dictator with a treacherous human rights record? And why would he do so on the eve of a national election in that country, when Clinton's mere presence could be read as an endorsement of the dictator's "candidacy"? It helps to look to Clinton's traveling companion, Canadian mining tycoon Frank Giustra. Short, compact, and sporting a gray-haired Caesar haircut, Giustra is estimated to be worth several hundreds of millions of dollars.
Bill flew on board the mining magnate's private jet: a "luxurious MD-87, complete with a bedroom and shower, gold-plated bathroom fixtures, leather upholstered reclining seats, flat-panel TVs and original paintings on the cabin walls.
The blankets are emblazoned with 'Giustra Air." It features a boardroom and sleeps eighteen comfortably. "The plane is a business tool. No more, no less," says Giustra bluntly. And one of its useful functions has been doing the Clintons favors.
For some years, Giustra has made his jet available to Bill to travel the globe delivering big-money speeches, as well as to travel to campaign events for Hillary's 2008 presidential campaign. As a Canadian citizen, Giustra couldn't donate to Hillary's campaign, but he could certainly offer use of his plane to Bill. He could also steer tens of millions to the Clintons and entities that they control. Giustra built his empire by cutting deals in some of the most dangerous parts of the world. At the time of his 2005 travels with Clinton, he lived in a palatial 12,000-square-foot home in western Vancouver. "Obsessively private," according to Canadian media, he operated out of a thirty-first-floor corner office on Burrard Street, a sloping boulevard with scenic views of Vancouver's port.
Less a mining executive than a penny-stock speculator, Giustra made his money pumping and dumping mining stocks in the Canadian stock exchanges." As the Globe and Mail, Canada's most prestigious newspaper, put it in a generally sympathetic portrait, Giustra got rich "through a Byzantine system of shell companies, furtive share purchases and elaborate compensation schemes."
In Kazakhstan he was looking to close a large deal. Giustra had done mining deals in sub-Saharan Africa and South America. He knew how to do business with autocrats. For an autocrat, the allure of doing a favor for an ex-American president, especially a former president with a powerful wife, likely held special value. As Giustra admitted in 2006 to the New Yorker in a rare moment of candor, "All of my chips, almost, are on Bill Clinton. He's a brand, a worldwide brand, and he can do things and ask for things that no one else can."
According to Clinton and Giustra, they first met in 2005. Technically, that might be correct. But their business ties actually go back decades earlier. Both men were involved with mining entrepreneur Jean-Raymond Boulle, whose company Diamond Fields invested in an Arkansas diamond mine that Clinton approved when he was governor.
At the time, Diamond Fields had its eye on an Arkansas state park known to have diamond deposits. So Boulle went to Little Rock and hooked up with Clinton pal Jim Blair. (Blair made headlines in 1994 as the man who helped Hillary Clinton turn $1,000 into $100,000 in futures.)
Blair took Boulle to see Governor Clinton and pitched a diamond mine in the Crater of Diamonds State Park." Boulle claimed the mine could become "one of the world's largest diamond producers." Governor Clinton signed off on the project and helped get the property green-lighted for mining in 1987. Clinton pal Bruce Lindsey (who went on to become a senior White House adviser and now serves as chairman of the board of the Clinton Foundation) provided legal services to the fledgling company.
For good measure, Diámond Fields set up its corporate headquarters in Hope, Bill Clinton's hometown. When Bill was elected president, Boulle was an invited guest at the inauguration in Washington, DC. That night, as the Clin- tons celebrated their victory at several inaugural balls around town, Hillary wore a 3.5-carat diamond ring that came from one of Boulle's mines. Giustra, through a variety of domestic and offshore holding companies, had more than sixty thousand shares of stock in Diamond Fields in the early 1990s. But by 2005 the public face of the Clinton-Giustra relationship was all about philanthropy.
The two would establish something called the Clinton Giustra Sustainable Growth Initiative (CGSGI) as a project of the Clinton Foundation. CGSGI is supposed to foster economic growth in the developing world. Its activities are often sited near "natural resource industry" projects such as mines or oilfields in which Giustra is invested. Access to Kazakh mining concessions is highly competitive. Large mining companies from Australia to Russia vie for them. Giustra's company, UrAsia Energy, was a new player with no background in the uranium business and was therefore far from the logical choice for Kazatomprom, the Kazakh atomic energy agency.
Other companies with decades of experience in the field should have been first in line for this lucrative deal. "Everyone was asking Kazatomprom to the dance," said Fadi Shadid, a senior uranium industry stock analyst. "A second-tier junior player like UrAsia-you'd need all the help you could get." UrAsia Energy was a mere shell company. But with Nazarbayev's approval, that was about to change.”