Court papers allege Kazakh backers mired in ‘massive financial scandal’

(Source: The Toronto Star)

The gleaming 80-storey condominium tower that was to lead the revitalization of the Yonge-Bloor intersection in Toronto is teetering on the edge of extinction.

On Monday, the Toronto lender that advanced a $46 million loan is going to ask a court to put the Kazakhstan-backed project into receivership and sell off the now-vacant land its international developer boasts is the “best address in the world.”

The lender, a consortium of Toronto businessmen, alleges in court documents that Kazakh developer Bazis International has defaulted on its land loan and the Kazakh bank backing the tower portion of the project is involved in a “massive financial scandal involving fake loans, racketeering and money laundering activities.”

“The (land) loan has been in an almost constant state of default since December of 2008,” said Toronto consortium leader Gary Berman, in a court affidavit supporting his group’s bid to appoint receiver Ernst &Young.

Read Yonge-Bloor development on the brink” in the The Toronto Star (July 17, 2009).

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