Tuesday, December 23, 2014


Uzbekistan

Swedish TV: How Millions In Telecoms Bribes End Up In Karimova's Pocket

Critics of Gulnara Karimova have labeled her a "robber baron" who pilfers funds from businesses operating in Uzbekistan to pad the family coffers.
Critics of Gulnara Karimova have labeled her a "robber baron" who pilfers funds from businesses operating in Uzbekistan to pad the family coffers.

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Waiting For Gulnara

Impenetrable Uzbekistan has suddenly found itself with a surprisingly vocal spokeswoman -- presidential daughter Gulnara Karimova. Karimova has become a combative presence on Twitter, even agreeing to debate critics like Andrew Stroehlein of the International Crisis Group about her country's dismal record on human rights. Stroehlein seized the opportunity, sending Karimova an open e-mail detailing some of Uzbekistan's most notorious transgressions. But will she respond?
By Farruh Yusupov and Daisy Sindelar
A new TV documentary airing on Sweden's SVT public television offers startling eyewitness accounts of how Uzbekistan's ruling regime negotiates, and extracts, millions of dollars in bribes from foreign investors.

The program, "TeliaSonera and the Dictator's Daughter," appears to bolster allegations that the Swedish-based TeliaSonera telecoms company paid $250 million in bribes to Gulnara Karimova, the daughter of Uzbek President Islam Karimov, in exchange for entry into the Uzbek market.

Fredrik Laurin, an investigative reporter with the current-affairs program "Uppdrag granskning," says the documentary includes testimony from two executives within TeliaSonera's organization who witnessed the 2007 deal to enter Uzbekistan, an agreement negotiated on Karimova's behalf by a longtime ally with ties to the telecom market.

"These executives tell the story of how the secret deal was struck between TeliaSonera and Gulnara Karimova's representative, Bekhzod Akhmedov, who is the former CEO of the Russian telecom operator MTS in Uzbekistan," Laurin says. "He was also the front man for Gulnara Karimova in deals with other telecom operators."

Citing fear of repercussions, both of the TeliaSonera executives featured in the SVT documentary remain anonymous, with their comments voiced by actors*.

But the testimony they offer is a damning portrayal of how the Uzbek regime, widely considered one of the most repressive and corrupt in the world, regularly strong-arms foreign investors into buying their way into the market.

'Robber Baron'

Karimova, a self-described businesswoman and pop chanteuse who officially serves as her country's UN representative in Geneva, has a personal fortune estimated in the billions of dollars.

Critics have labeled her a "robber baron" who pilfers funds from businesses operating in Uzbekistan to pad the family coffers.

One of the TeliaSonera executives interviewed in the Swedish program describes Akhmedov, a prominent Uzbek entrepreneur, as the figure who served as Karimova's "agent." "He was her friend, her link into the telecoms world. He was handpicked by her," the executive says.

The documentary alleges that it was Akhmedov who met with TeliaSonera executives in February and March 2007, when the company -- a Swedish-Finnish venture whose largest shareholder is the Swedish government -- was looking to purchase a 3G license and frequency rights.

One of the executives claims a deal with Karimova was considered a "prerequisite" to the entire deal.

He adds that the negotiations were made all the more bizarre by the fact that Akhmedov was acting on her behalf even as he was serving as the head of a rival company. "Bekhzod was the counterpart. It was a totally crazy situation. Bekhzod was the CEO for the competitor, MTS. And there sat TeliaSonera, in the competitor's office, negotiating about money for the Karimov family," the executive says.

Shadowy Company

Laurin, who works in tandem with fellow Swedish journalists Sven Bergman and Joachim Dyfvermark, documented in a September "Uppdrag granskning" program that TeliaSonera had paid $250 million in illegal funds to a shadowy Gibraltar-based company, Takilant.

Takilant, which was run by a 24-year-old Karimova associate, Gayane Avakyan, is at the center of an ongoing Swiss money-laundering investigation. Swiss prosecutors have frozen more than $600 million in Uzbek assets and placed four Uzbeks -- including Akhmedov and Avakyan -- under investigation.

Laurin says that Swedish police have declared that they formally suspect two high-ranking TeliaSonera executives of bribery in connection with the case. Both the Swedish government and the TeliaSonera CEO, Lars Nyberg, have denied any knowledge of wrongdoing in the deal.

Akhmedov, head of MTS's Uzdunrobita, gained notoriety this summer when the authorities in Tashkent accused the company of massive tax evasion. Police arrested five managers, intimidated employees, and shut down operations in what many observers saw as a blatant takeover bid by the Uzbek regime. Uzbek courts, in an apparent retreat, in November reversed a ruling to seize Uzdunrobita's assets.

Akhmedov fled Uzbekistan at the height of the scandal and vanished. His location is currently unknown, although reports on Uzbekistan's UzMetronom website suggest he briefly sought refuge in Russia before being returned to Uzbekistan at the behest of an evidently displeased Karimova.

'That Was A Surprise'

An account by a Swiss journalist cited in the SVT report lends credence to a rift between Karimova and her onetime henchman, whose intimate knowledge of her financial dealings may have made him a liability abroad.

Yves Steiner, a financial correspondent with the Swiss public television station RTS, says Swiss officials first opened their investigation into the Uzbek money-laundering case after Avakyan walked into the Lombard Odier Bank in Geneva and attempted to get access to a large account managed, until then, by Akhmedov.

"Bekhzod Akhmedov apparently got angry with Gulnara Karimova, but it's not yet clear how, exactly," Steiner says. "In any case, people close to Gulnara Karimova came to Geneva and said, 'No, it's no longer Bekhzod Akhmedov who's the holder of this money, but Gayane Avakyan.' For the bank, that was a surprise."


CORRECTION: This story has been amended to reflect the fact that the SVT television documentary used actors to voice the statements from TeliaSonera executives wishing to remain anonymous.

Daisy Sindelar

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Comments
     
by: Jack from: US
December 13, 2012 16:05
"How Millions In Telecoms Bribes End Up In Karimova's Pocket"

and how millions end up in US government officials pockets? The good old way:
A juicy government contract with a private company where an official (like e.g. Cheney with Halliburton) happens to be a stakeholder.. Ah those badly corrupt Uzbeks.. they have a long way to go to learn from US government mafia
In Response

by: Frank from: London
December 14, 2012 05:20
Jack
And the American press isn't smart enough figure out conflicts of interest along the lines you allege with Mr Cheney? I don't doubt he owns shares in Haliburton, but controlling the whole process of awarding it contracts and knowing in advance when there are so many people like yourself eager to expose it seems a bit fanciful. With Gulnara Karimova it is a whole different story: Uzbekistan is around the 5th most corrupt country in the world and Gulnara gets help from a Government her father controls and from the lack of a tradition of investigative journalism there. I have no evidence of this, but in a country where the judiciary is not independent and is corrupt, it is likely she has a coterie of thugs she can rely on to extract money from any business in Uzbekistan that is doing too well or is competing too well against her businesses. The sort of subtle indicators perhaps one should be looking at are how easily and wastefully she and her sister spend their ill gotten gains: $220,000 for Gulnara to get her pictures in Paris Match (done by inviting Monica Bellucci to a party and paying Ms Bellucci an attendance fee) and paying an utterly mega premium on a property in Geneva that had only changed hands at a fraction of the price a few years earlier (there hasn't been a mega boom in Geneva real estate?). It is a sign of how desperate they are to secure a safe place for their ill gotten gains perhaps, or perhaps (when the money comes easily) how little business acumen they really have.
In Response

by: Alex from: LA
December 14, 2012 08:25
Frank its not always lack of " investigative journalism" but how that government and their "dirty laundry" goons deal with those people, just like KGB did, chik i v kolodets, (translation from: Gentlemen of Fortune; slash and into the gutter. Slash or chik meaning cutting a throat sound.) The problem lies deeper than having certain laws or policies in place, but the psyche of a people. The only way to change that is only through correct education of the next generation, until that happens no law or war will fix this, just like Isreali/Palestine problem or Armenia/Azeri problem... The only way is through change of thought and ideals, aggressive vs progressive (get the point of not putting the obvious peaceful opposite, sometimes the opposites don't work, or healing don't work, but moving forward works better than eye for an eye mentality that human beings give credit to). In conclusion, corruption is part of human nature, but nothing is being done about the problem, but what's done is working around the problem, just like the US Congress is trying to deal with the "fiscal cliff"
In Response

by: Jack from: US
December 14, 2012 15:32
corruption in US government and on Wall Street is institutionalized. US government crooks cover up for illegal drug trade from Colombia and Mexico, for insider trading on Wall Street, and for looting of public companies by CEOs who happen to have connections with US government. It is a "feature" of US system. The only reason this system did not collapse (yet) is because it is being constantly fed by endless borrowing
In Response

by: Frank from: London
December 15, 2012 18:37
Jack, I think we have to agree to disagree: the Madoffs, Kozlowskis, Enrons, WorldComms, Martha Stewarts, Galleon Hedge Funds, etc. are headline makers of course, but I don't think that necessarily makes the problem "institutionalised". The combination of high rewards for people who can expose such wrong doing plus the fact the truth often "outs" during periods of low profits (when relationships are more strained?) probably does keep the problem in check (periodic recessions are unavoidable?). The same periodic reality checks can't be said to occur in Uzbekistan however. The only one the leadership there gets is when it is forced to travel to occasional events abroad. Mr Karimov's last trip to Brussels lasted only a few hours?

Alex, I agree the problem is deeper than a lack of investigative journalism and that Gulnara is not the only corrupt person in the country. What makes her particularly odious is her charity work cover-up and the publicity seeking aspect using out-of-date pictures of herself: I believe she is a 40 year old single mother, and the picture I've seen of her in the Financial Times (out of her editorial control) does justice to that view.
In Response

by: Jack from: US
December 15, 2012 19:01
Frank says: "..high rewards for people who can expose such wrong doing..".
Yes, indeed... I recall a case with a lady who run high-end escort business for US Congress and Senate. About 3 years ago she once threatened to publicize the list of her clients. She was found hanging in her mother's garage in Tampa. The coroner immediately ruled "suicide" and "free" US media quickly hushed any discussion. She ripped her "high reward".
In Response

by: Frank from: London
December 17, 2012 14:14
Jack, I agree the Palfrey case to which you allude would be vindictive if it were just for prostitution and unpaid taxes, but in her case there was possibly an additional element of "racketeering" (an offence that covers extortion and witness tampering?). An alternative explanation to Ms. Palfrey's powerful clients (Senator Vittor?) abusing your justice system is that there may have been an element of "deterrence" included in the sentencing guidelines. There is no comparison between the USA (no. 24) and Uzbekistan (no. 177) in corruption levels (Source: Transparency International 2011). Gulnara Karimova is a crook ($250m obtained in a single hit: she has sold licencing rights she does not own, and she has been at it for a long time), and her modus operandi is particularly repugnant (excessive publicity for small amounts of charity money raised and the "I am too sexy to be involved crime" image she promotes of herself). Just my view.
In Response

by: Jack from: US
December 17, 2012 17:42
Yes, Frank, Karimova is a daughter of Uzbek-bashi Karimov who owns Uzbekistan. The main difference with Karimova and crooks in US government is not that they steal more than Karimova, but that they kill hundreds of thousands people, in Iraq, in Afghanistan, in Syria (via their proxy thugs from "Free Syrian army"), in Libya, in Kosovo, in Bosnia, etc, etc
In Response

by: Frank from: London
December 18, 2012 14:28
Jack, one of many consequences that follows from your reasoning "they [crooks in US government] kill hundreds of thousands people, in Iraq, in Afghanistan, in Syria (via their proxy thugs from “Free Syrian army”), in Libya, in Kosovo, in Bosnia, etc, etc" surely is:

that the American public is easily duped into electing them, and you, helped by a superior quality of reasoning and knowledge, are not.

The figures for deaths from violence associated with the allied invasion of Iraq and its subsequent occupation range from 150,000 to over a 1 million. You can add on, according to taste, deaths of people from shortages of medicine during the sanctions prior to the invasion depending on whether you think Saddam Hussein was a nice, regular guy or not.

by: Anonymous
December 13, 2012 18:34
really disgusting!

why do western enterprises support corruption in asia?
why do western enterprises support dictatorships?

why do people like greenspan and others under clinton, reagan, bush and obama lie, take money, give false evidence, report false information merely to pave the way for more corruption and eventually for some corporations, banks and business men to get more millions of dollars.
gulnara karimova seems to be a copy cat who learns fast. being the president's daughter gives her powers greenspan, corrupt bankers, politicians and greedy university profs alike would dream of having.
well, in this case gulnara and even the aliyevs are the lucky ones.
no wonder that in some parts of the world some people within the elite couldn't care less if they know how people on wall street and other places in the western world really act.
how can you exert positive influence if the way you live is already tainted.

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