Uzbekistan's first daughter accused of pocketing $1bn in phone deals
Gulnara Karimova, the estranged daughter of Uzbekistan’s strongman leader Islam Karimov, is facing fresh allegations of corruption after an investigation accused her of accepting more than $1bn from telecoms companies wanting a slice of the lucrative mobile phone industry.
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The Organised Crime and Corruption Reporting Project (Occrp), run by a group of investigative journalists, reported this week that Karimova had received the money in payments and shares from Scandinavian and Russian telecoms companies including TeliaSonera, Telenor, MTS, and Alfa Telecom
Occrp described her schemes as “audacious” accusing them of diverting money from Uzbekistan’s national coffers in to banks, an offshore hedge fund and luxurious real estate around the world.”
The investigators accuse Karimova of demanding percentages of companies and extorting cash for her “personal services and lobbying efforts”.
Karimova “demonstrated a ruthless ability to acquire a share of ownership (her preferred rate was 26%) of lucrative telecom-related companies – without actually putting up any money,” they said.
Investigators say they have evidence that that Nordic telecoms giant TeliaSonera paid Karimova $381m and promised another $75m to order to start trading in Uzbekistan’s cellphone market. Russian company MTS is reported to have paid $350m, with VimpelCom, a joint venture between Russia’s Alfa Telecom and Norway’s Telenor, said to have spent $176m.
Occrp say that the data was compiled using an external review of TeliaSonera conducted by law firm Mannheimer Swartling; a Dutch request for legal assistance; data from the US Securities and Exchange Commission; and other financial documents.
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Allegations of mass corruption involving Karimova and the telecoms sector surfaced in 2012, when TeliaSonera was accused of shelling out $330m in suspicious payments for the rights to operate in Uzbekistan. That sparked a corruption probe in Sweden, which is linked to a money-laundering investigation in Switzerland in which Karimova is a formal suspect.
TeliaSonera, also under investigation in the United States and the Netherlands, denies allegations of bribery and money-laundering, but has acknowledged that “the processes for conducting some transactions have not been in line with sound business practices”.
The Russian companies MTS, VimpelCom, and Alfa Telecom also deny any wrongdoing. Norway’s Telenor, which is being probed in Switzerland, the Netherlands and the United States over allegations it made “unlawful payments” of $55m in Uzbekistan, also denies bribery, and claiming they have “zero tolerance for corruption”.
Karimova is also under investigation in Uzbekistan on charges of corruption. It was reported in September 2014 that she could face a lengthly prison spell but there has been no movement on the case since.
Karimova has always denied any wrongdoing, claiming the charges against her are politically motivated. She has been under house arrest in since February 2014 and has not been seen for months.