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Cash Cow For Karimova: Court Documents Assert Shakedown By Daughter Of Late Uzbek President

Gulnara Karimova attends an Independence Day celebration in Tashkent in August 2012.
Gulnara Karimova attends an Independence Day celebration in Tashkent in August 2012.

The story of the rise and fall of Gulnara Karimova, the elder daughter of Uzbekistan's late president, has been gradually unearthed and corroborated by reporters and police in multiple countries in the three years since she disappeared from the public eye under reported house arrest in Uzbekistan.

But details of her efforts to wrest control of a major telecoms operator, and the sprawling criminal investigation that continues, have not been fully explored to date.

Now, court documents obtained by RFE/RL detail a relentless campaign of intimidation in a multibillion-dollar case that led to an international corruption investigation and her stunning fall from grace.

The assertions are contained in documents compiled by Swedish prosecutors pursuing criminal bribery and other charges against former top executives of the Scandinavian telecom company previously known as TeliaSonera.

The documents include an affidavit filed in September 2012 by one of Karimova's closest business associates, Bekhzod Akhmedov, a former senior executive at one of Uzbekistan's largest telecom companies, Uzdunrobita.

In it, Akhmedov asserted that Karimova and an aide issued explicit or implied threats against him and his family, and pressured him to pony up hundreds of thousands of dollars for a Karimova-foundation event. They even pushed him to sell a family home to meet the demand for cash, and reminded him that "every dollar of your property belongs to me."

His statements shed light on alleged tactics that had already made Karimova "the single most hated person in the country," in the words of a leaked U.S. diplomatic cable. She reportedly remains incommunicado in Uzbek custody.

Akhmedov made his initial, 17-page affidavit to an investigator with the Russian Interior Ministry's organized-crime unit with his lawyer present in Moscow in 2012, about three months after he had fled Uzbekistan.

Akhmedov said he bolted his home country in June 2012 "fearing for my life and health, as well as that of my family" following a series of increasingly hostile threats by Karimova.

Akhmedov is still believed to be living in Moscow. Attempts by RFE/RL to locate him for further comment were unsuccessful.

Attractive Target

Founded by U.S. investors at the time of the Soviet collapse, Uzdunrobita had been essentially controlled by Karimova through a series of shell companies since 2002.

Akhmedov initially joined Uzdunrobita thanks in part to an exchange program in which he participated in the United States, where he met Uzdunrobita's U.S. investors in the late 1990s. He later became director of one of its main divisions.

Akhmedov said he met Karimova in 2001 through his sister, who was a university classmate of hers in the Uzbek capital. Karimova, he said, invited him to work simultaneously for a retail clothing store that sold Levi's jeans in Tashkent, among other things.

Later in 2001, he said, he introduced Karimova to Uzdunrobita's main U.S. investors, who were seeking a new license in Uzbekistan and wanted her to seek involvement of her father, then-President Islam Karimov. Karimova demanded a 20 percent stake in Uzdunrobita, Akhmedov said, and threatened problems for the company. The two sides ultimately created a new structure for the company.

By 2004, Uzdunrobita's U.S. investors were actively seeking to exit Uzbekistan, in part because of currency restrictions that prevented them from converting their Uzbek profits into U.S. dollars.

Mobile-phone use was exploding in Central Asia's most populous country and around the region, and the growth potential for the Uzbek market attracted the attention of Russia's largest telecom, MTS, which eventually took control of Uzdunrobita over the next three years, reportedly at a cost of $371 million.

Other companies, including VimpelCom -- which was controlled by a group of Russian oligarchs and was Russia's No. 3 cell-phone provider -- and Finnish-Swedish TeliaSonera, which later changed its name to Telia, also saw potential in the Uzbek market and began investing there.

In December 2011, Akhmedov, who was Uzdunrobita's general director at the time, was notified that Uzbek tax authorities and prosecutors were investigating the company for unspecified legal violations. By the following March, the company had been notified it owed the Uzbek state around $1.5 million

In February 2012, Akhmedov said, Karimova's close associate Gayane Avakyan ordered him to come to Karimova's Tashkent office, where he said he was notified that he owed Karimova $15 million stemming from what she alleged were losses from Uzdunrobita's advertising operations in 2007-11.

"I didn't react to Karimova's demands to pay her [$15 million], but in response to Gayane Avakyan's questions about when the payment would be made, I answered that I was considering how to resolve this problem," Akhmedov said in the affidavit.

Later that month, Akhmedov said that Avakyan notified him that he and all members of his family were under surveillance and warned them not to leave the country. He said Karimova later demanded that he sell his father's house for approximately $1 million. Otherwise, he said, she told him, "they might throw Bekhzod in jail."

After paying Karimova $1.16 million in several installments from the sale of his father's home, Akhmedov said, he moved into an apartment with his parents and his sisters.

In May 2012, he said, Avakyan asked Akhmedov about the whereabouts of his wife and children. Akhmedov told her they were living in Moscow, where his youngest daughter was getting medical treatment. Avakyan allegedly demanded to know their address, along with photographs of the residence in Moscow and copies of utility bills. Akhmedov said he complied, according to the court document.

On May 14, 2012, he said, he received an invoice from Karimova's charitable foundation, called the Fund Forum, in the amount of $250,000, to attend a gala event being held during the Cannes Film Festival in France. The event was being hosted, he said, by Monaco's Prince Albert and the foundation of former President Bill Clinton. It was co-sponsored by Karimova's fashion business, Guli. He said he borrowed money from acquaintances and four days later paid her the requested amount.

Ratcheting Up Pressure

Most of Karimova's demands, Akhmedov said, were relayed through Avakyan, except on two occasions when Akhmedov spoke directly to Karimova on the phone, once through speakerphone in discussing the Cannes gala.

She "demanded money, but didn't name an amount, threatening only that in the worst-case scenario, I would be taken to court. Moreover, Karimova said that she didn't care where I got the money from," he said according to the affidavit. "Her speech was accompanied by unprintable words."

Later in May 2012, he said, Karimova demanded that Akhmedov's wife and children return to Tashkent and that their apartment in Moscow be sold to pay off the alleged debts.

A message from Karimova that he received on his Blackberry later that month and reportedly shared with the Russian investigator said, "We hope to receive all outstanding sums, as initially requested, in order to halt the process of criminal consequences in all cases.... If you find it difficult to sell your home more quickly, give me documents and our representatives will sell it in the coming days. Under any circumstances, every dollar of your property belongs to me."

On June 1, 2012, Akhmedov said, he submitted a letter of resignation as Uzdunrobita's general director. The next day, he received a letter signed by Karimova, again via his Blackberry: "Bekhzod, in answer to your note: before you can say farewell, you must fulfill your obligations. Everyone is tired of repeating this. The faster you bring order to these affairs, the quicker this all will be finished," the letter said.

"It's fully possible that this will be the last warning, and in the near future, how events unfold will depend on your speediest actions. It should be noted right away that if you try to use your children, your wife, or your family as an excuse, it's better not to even go there; that should have been thought of earlier," the letter said.

Five days later, he fled Tashkent.

"Karimova's baseless demands, as dictated here and in the text of the previously provided letter, of the illegal transfer of the property of myself and my family, I took to be, and continue to take as, genuine threats of violence directed toward me and my family members," Akhmedov said in his affidavit.

Two months later, in August 2012, Uzdunrobita and MTS lost their license to operate in the country.

In 2014, MTS announced it was under investigation by U.S. authorities for possible violation of U.S. corruption laws. Two years later, the company announced it was selling its stake in Uzdunrobita and leaving the country altogether.

VimpelCom also announced that year it was the subject of a U.S. investigation, and last year agreed to pay almost $800 million to settle bribery claims in the United States and the Netherlands.

Telia agreed in September to pay approximately $1 billion in criminal and civil penalties to U.S. and Dutch authorities in connection with bribes that officials said were paid to a Gibraltar-based shell company controlled by Karimova.

VimpelCom, U.S. and European officials said, used the same Gibraltar-based shell company to make payments to Karimova.

On September 22, Swedish prosecutors charged three former TeliaSonera executives with paying bribes as part of an effort to get a mobile-phone license in Uzbekistan.

'Cash Cow To Milk Anytime'

While it is difficult to independently confirm Akhmedov's account, many of the facts, dates, and figures in his 2012 affidavit match up with findings made by European law enforcement, Uzbek civil-society activists, corporate filings, and journalist reports.

Akhmedov's statements are significant enough that Swedish prosecutors, as well as Swiss prosecutors who are conducting a parallel criminal investigation, have included them in some of their court filings.

In 2015, three years after his initial affidavit to Russian law enforcement, Akhmedov was interviewed for four days in Moscow by Swiss investigators. Transcripts of those interviews were also included in the criminal proceedings in Sweden, where prosecutors are seeking his testimony.

In one interview, Akhmedov described Karimova variously as his friend and also his perpetual creditor. "She looked at me like I was her slave," he said, according to a transcript. "She treated me as a 'cash cow' that she could milk at any time. On the one hand, she invited me to her birthday party. On the other hand, she forbade my parents to travel abroad and tried to seize my houses."

He told the Swiss investigators he had no choice but to obey Karimova. Otherwise, he said: "I would have ended up in a psychiatric hospital. She could even have killed me."

RFE/RL shared Akhmedov's Russian affidavit with an Uzbek national who also worked closely with Karimova in the early 2000s and later fled the country. He said the details matched up broadly with his recollection.

Dudley Christie, an American eye doctor who was involved in setting up Uzdunrobita before cashing out in the early 2000s, said he remembered Akhmedov well. Christie told RFE/RL he could not be 100 percent certain of the dates and details of, for example, the sale that gave Karimova greater control of Uzdunrobita, but he said it largely matched his recollection.

"He used to be a fairly straight shooter," Christie said of Akhmedov. "I also knew the first family really well; if they wanted something, they would get it."

"I saw the handwriting on the wall. There was so much crookedness over there, so much corruption in that region, I knew that [instead of] screwing around over there, I could make more money being an eye doctor," he said. "I knew we had to get what we could and at least for the American side, the investors, to get out of these things, without losing our shirt."

In July, nearly a year after the death of Karimova's father, Uzbekistan's chief prosecutor for the first time confirmed that Karimova had been arrested, saying she was convicted in 2015 of economic crimes and sentenced to five years of "restricted freedom."

RFE/RL's Uzbek Service contributed to this report
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    Mike Eckel

    Mike Eckel is a senior correspondent reporting on political and economic developments in Russia, Ukraine, and around the former Soviet Union, as well as news involving cybercrime and espionage. He's reported on the ground on Russia's invasion of Ukraine, the wars in Chechnya and Georgia, and the 2004 Beslan hostage crisis, as well as the annexation of Crimea in 2014.