Jamshed Ziyoyev, ex-chairman of Tajprombank that reportedly collapsed under the weight of bad faces charges of embezzlement and fraud.

“Criminal charges have been brought against Jamsehd Ziyoyev under the provisions of two articles of Tajikistan Penal Code: Article 245 – embezzlement and misappropriation and Article 247 – fraud,” a source in the law enforcement authorities told Asia-Plus in an interview.   

Recall, Jamshed Ziyoyev was detained on April 24.

Founded in October 1995 as an all-purpose retail bank, Tajprombank, with headquarters in Dushanbe, has 21 branches, 11 departments and 15 money-transfer offices across the country.  The controlling shares of the company were held by Jamshed Ziyoyev.

Assets on Tajprombank’s books include dozens of offices and an unspecified number of residential properties.

Signs the lender was in distress began to emerge in 2015.  In the middle of 2016, Ziyoyev was removed as head of the bank, which was placed under crisis administration.  In December, the National Bank declared it was refinancing Tajprombank to the tune of 450 million somoni ($56 million) and reappointed Ziyoyev to his old job and ordered him to restore the lender to health.  The bailout money was raised through the emission of somoni-denominated sovereign bonds that were converted into liquid cash by the National Bank.

But then two months later, the National Bank performed yet another about-face and decided to shutter Tajprombank, together with another recipient of bailout funds, Fononbank. 

Tajprombank reportedly had over the years accumulated a number of high-stakes delinquent debtors.

One such person, Jamshed Abdulov, a businessman involved in the cotton industry, was detained by authorities over unpaid debts, according to EurasiaNet.org.  Two companies belonging to him – Cotton Textile and Olim Textile – collectively owed Tajprombank 39 million somoni (equivalent to 4.4 million U.S. dollars).  After paying off his liabilities in the form of solid assets, Abdulov was reportedly released on bail.

EurasiaNet.org says sources familiar with the situation have told that companies affiliated to Ziyoyev and his son owed another 13 million U.S. dollars to the bank.

Tajprombank reportedly also has liabilities before the state — US$13 million with the Finance Ministry and another US$15 million with the National Bank.  Under Tajik law, the bank is required to settle its debts to the state before it pays out retail customers.