Real estate dreams dashed: Kazakhstani investors lose big in crowdfunding bust
Dozens of Kazakhstani investors who lost money through real estate investments on the Proportunity platform plan to file a lawsuit in the Astana International Financial Centre (AIFC) court against the Astana Financial Services Authority (AFSA), AIFC’s independent regulator. The investors, who accuse AFSA of inaction and failing to protect their rights, intend to take legal action by the end of March. They recently published their appeal on the Finance.kz Telegram channel.
What is the dispute about?
Proportunity Management Company Limited (PMCL), a crowdfunding company licensed by the AIFC, entered the market in 2019. It offered Kazakhstanis a real estate investment model in which users selected properties on the company’s platform. PMCL pooled investors’ funds to purchase properties for renting out or resale, with investors expecting to receive dividends.
In mid-summer 2024, PMCL clients reported that they had not received payments. Many had invested in the Lake Villa project, a development featuring comfort-class villas on a lakefront in Almaty. Investors were supposed to receive their first dividends in May, but the company not only failed to pay them but also ceased communication.
Later, venture investor Bakht Niyazov claimed on social media that PMCL had attempted to purchase Lake Villa homes from his company using investors’ funds. Although an agreement was signed, the payment was never made, leading to the contract’s termination.
In August 2024, the Digital Business portal cited a response from PMCL founder Arman Bayev, who denied that the company had defaulted and insisted it was working to return clients’ money. Bayev argued that the Lake Villa project’s lack of appeal led to insufficient investor participation, preventing PMCL from completing the purchase. He also stated that all investors had been notified about the project’s closure.
PMCL’s AIFC license expired on July 1, 2024. Bayev claimed the company was working to renew it.
What investors are saying?
Investors claim that eight months have passed since they filed a complaint against the company, yet the AIFC has taken no action to protect their rights.
«Proportunity Management received a license from the AIFC regulator on July 3, 2020. In August 2022, its head, Arman Bayev, had his accounts frozen, was banned from leaving Kazakhstan and faced court rulings to collect debts. This information was available on counterparty verification platforms. Despite this, the regulator extended the platform’s license twice: first from July 2, 2022, to July 1, 2023, then from July 1, 2023, to July 1, 2024,» the investors said.
They argue that if the AFSA had properly supervised AIFC-registered companies, as it is required to do, their losses could have been prevented.
«We, as non-professional investors, trusted AIFC licenses as a guarantee of reliability, but the regulator did not live up to our expectations,» they noted.
The investors also claim that despite PMCL’s financial troubles in August 2022, the AIFC regulator allowed Bayev to register a new company, ACLB Management Company Limited.
«We believe the registration of ACLB in the AIFC enabled Arman Bayev to continue his activities since Proportunity’s accounts were frozen. This allowed him to keep raising funds through Islamic investment deposits, with ACLB acting as the operator and Proportunity as a ‘trustee authorized by the AIFC.’ We view the regulator’s failure to verify Bayev’s business reputation when registering ACLB as a serious oversight that led to even more victims,» they stated.
Investors also highlighted that after losing his license, Bayev continued aggressively advertising the platform on social media using outdated licensing information, misleading new investors. They argue that the regulator’s failure to take decisive action to stop this activity only worsened the situation.
In December 2024, the regulator announced on the Finance.kz channel that PMCL’s shareholders had committed to returning funds to investors. It also stated that if they refused, the agency would file a case with the AIFC court to force recovery. However, since then, investors say there has been no progress or updates on legal action.
«Our inquiries are being ignored,» the investors said.
They are demanding that the AIFC take control of the situation and assist in holding Bayev criminally accountable. Otherwise, they plan to file a lawsuit.
In late December, the AIFC reported that since May 11, it had received 19 complaints from PMCL investors regarding non-payment of 104 million tenge (over $200,000).
The AFSA’s response
The AFSA responded to Kursiv.media’s inquiry, stating that it is conducting a thorough internal investigation to establish the facts and hold those responsible accountable. The agency emphasized that it operates in strict compliance with AIFC legislation and will take all necessary measures to protect investors’ rights and ensure financial market stability. As the investigation progresses, it will provide updates within the limits allowed by law enforcement protocols.
