Tag Archives: corruption

Sweden drops Telia bribery case in Azerbaijan

MAY 3 2016 (The Conway Bulletin) – Prosecutors in Sweden dropped an investigation into alleged bribe paying by TeliaSonera, now called Telia Company, in Azerbaijan, relieving the pressure on the Nordic region’s biggest telecoms company but disappointing corporate governance campaigners.

Scrapping the investigation also ditches a potentially embarrassing public hearing for Azerbaijani President Ilham Aliyev and his family into their personal affairs. TeliaSonera was alleged to have paid millions of dollars indirectly to Mr Aliyev and his family for access to Azerbaijan in 2008.

Prosecutors said they could neither prove the bribery allegations nor Telia’s intent.

Allegations of the payment emerged in mid-2014, nearly two years after TeliaSonera was accused of paying a $375 million bribe to Gulnara Karimova, the eldest daughter of Uzbek President Islam Karimov, for access to Uzbekistan.

“With the tools we have at our disposal, we can’t prove bribery,” Gunnar Stetler, Sweden’s prosecutor, told Reuters in an interview.

Telia said the ruling marked another departure from the company’s more murky past.

“After today’s decision, there are no ongoing Swedish investigations that relate to Telia Company, except for the investigation regarding Uzbekistan,” Telia said in a statement.

Telia is linked to investigations in Sweden, the Netherlands, the US, Switzerland and Norway into alleged corruption linked to Ucell, its subsidiary in Uzbekistan.

Last September, Telia said it wanted to sell off its assets in the South Caucasus and Central Asia. Turkish telecoms company Turkcell, in which Telia owns a stake, said it was interested in buying some of these companies.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Telenor official quits after Uzbek bribery investigation

MAY 3 2016 (The Conway Bulletin) – Norwegian telecoms company Telenor said its CFO Richard Olav Aa and General Counsel Pal Wien Espen resigned after an internal investigation on alleged corruption at VimpelCom — of which Telenor owns 33% — in Uzbekistan. The investigation concluded that although there had not been any corruption within Telenor, weak structures within the company had allowed corruption within VimpelCom to exist. In February, VimpelCom admitted to paying $115m in bribes to officials in Uzbekistan.

ENDS

(News report from Issue No. 279, published on May 6 2016)

US prosecutors finally name Uzbek Pres. daughter in corruption probe

APRIL 22 2016 (The Conway Bulletin) – The US named Gulnara Karimova, the eldest daughter of Uzbekistan’s President Islam Karimov, as the beneficiary of bribes worth $550m taken between 2007 and 2013 from telecoms companies wanting access to the Uzbek market.

This was the first time that Ms Karimova, 43, has been named in connection with the corruption case since news of the deals became public three years ago.

It’s also a reminder of just how tightly President Karimov and his family ran Uzbekistan, seemingly viewing it as their personal fiefdom, and how telecoms companies, from Sweden’s TeliaSonera to US-listed VimpelCom, had to bribe their way into the market of 30m people.

TeliaSonera rebranded as Telia Company earlier this month. Both Telia and VimpelCom are the subject of investigations in the corruption cases. Telia is also trying to sell off its subsidiaries in Central Asia and the South Caucasus.

A Bloomberg News report from New York said that prosecutors had named Ms Karimova after previous requests to recover cash, which they said had been laundered, were ignored.

“Prosecutors made the request in a letter to a Manhattan federal court judge on Thursday (April 21), saying Karimova and the group failed to respond to a civil forfeiture complaint against three bank accounts,” Bloomberg reported.

Ms Karimova had previously only been referred to, rather obliquely, as: “Government Official A, a close relative of a high-ranking Uzbek government official.”

Being named in the reports will bring further international notoriety on Ms Karimova.

She had once been spoken of as a future leader of Uzbekistan, a label she appeared to wear lightly while she produced pop videos, hosted fashion shows and concocted her own perfume range.

Now Ms Karimova has disappeared from public sight, having been placed under house arrest in Tashkent two years ago.

ENDS

(News report from Issue No. 278, published on April 29 2016)

Sariyev quits as Kyrgyz PM to fight corruption allegations

APRIL 11 2016, BISHKEK (The Conway Bulletin) — Temir Sariyev quit as Kyrgyzstan’s PM, less than a year after taking the job, after he was accused of corruption over a roadbuilding contract.

Three days later parliament voted in Sooronbai Jeenbekov, considered a heavyweight politician from Osh and loyal to President Almazbek Atambayev, as the new PM.

Emil Juraev, a professor at the American University of Central Asia, said Mr Jeenbekov may have been handed the PM job because he is able to unify bickering north-south factions.

“The new PM is a figure that suits all interested parties,” he said. “He is less ambitious and autonomous, compared to Sariyev.”

Still, Mr Jeenbekov is Kyrgyzstan’s sixth PM since a new constitution that handed more power to parliament was imposed in October 2010, highlighting just how fractured the Kyrgyz political landscape is.

On the streets of Bishkek, the frustrations of ordinary Kyrgyz that another PM had lasted less than a year were evident. Kablanbek, 60, said that he was disappointed to see Mr Sariyev go already.

“He should have worked for at least two-three years. Quitting after one year in office was a terrible idea,” he said.

At the centre of the latest corruption allegation to hit Kyrgyz politics was a contract Mr Sariyev handed to a Chinese company last year.

Mr Sariyev has denied that there was any corruption involved. Giving a resignation speech at this final government meeting, he said that he was the victim of lies and intrigue.

“I have neither time nor intention to play such political games,” he said. But many people held a different view. They have become cynical of Kyrgyz politicians and high levels of corruption. Daniyer, a 25-year-old student, reflected the views of many when he said: “In such positions, everyone tries to seize the opportunity to rob the country.”

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(News report from Issue No. 276, published on April 15 2016)

Business comment: Panama’s Pandora’s Box

APRIL 8 2016 (The Conway Bulletin) – The leaking of millions of documents from the Panama-based law firm Mossak Fonesca, dubbed the Panama Papers, hit the headlines this week both for the number of secret documents it disclosed and for the profiles of those involved in hiding money in offshore accounts.

For the Central Asia/South Caucasus region, one important story is the large-scale involvement of the Azerbaijani Presidential family in the country’s gold business.

Investigations on the awarding of the Chovdar project contract to a consortium of offshore companies had already unveiled that Ilham Aliyev’s family was behind Globex International, which owned 11% of the venture.

The latest leaks, though, showed that Mr Aliyev’s daughters, Leyla and Arzu, in fact, also owned Panama-registered Londex Resources, which owned another 45% of the project.

This makes the presidential family the majority owner, with a combined stake of 56%, of a project that holds gold reserves previously valued by the government at around $2.5b.

Other important figures from the South Caucasus and Central Asia, such as Georgian billionaire and former PM Bidzina Ivanishvili and Nurali Aliyev, grandson of Kazakh President Nursultan Nazarbayev, were also revealed to have hidden money in offshore accounts.

But this, although morally questionable, is not an illegal practice.

What is suspicious, and unfair, is when the Azerbaijani government awards the Presidential family’s unknown offshore companies a very favourable gold contract.

ENDS

(News report from Issue No. 275, published on April 8 2016)

UAE extradites Alimbetov to Kazakhstan

APRIL 5 2016 (The Conway Bulletin) – A court in the UAE extradited to Kazakhstan Mirkhat Alimbetov, former head of Kakadu, a construction company accused of embezzling around $3m from government tenders. Mr Alimbetov is now being held in a prison in Astana before his trial. He has been on the run since 2009.

ENDS

(News report from Issue No. 275, published on April 8 2016)

Panama papers reveal Kazakh, Azerbaijani, Georgian offshore accounts

APRIL 3 2016 (The Conway Bulletin) – A massive leak of documents from the Mossack Fonseca law firm based in Panama showed that government leaders and businessmen around the world have been using offshore tax havens to shelter assets and cash. Included in this list were Azerbaijani President Ilham Aliyev’s family, Georgia’s former PM Bidzina Ivanishvili and the grandson of Kazakh President Nursultan Nazarbayev.

ENDS

(News report from Issue No. 275, published on April 8 2016)

“World’s biggest bribe scandal” involves Kazakhstan and Azerbaijan

ALMATY, MARCH 29 2016, (The Conway Bulletin) — Unaoil, a consultancy based in Monaco, channelled millions of dollars of bribes to Emerging Market governments and their companies, including in Azerbaijan and Kazakhstan, on behalf of major Western firms, an investigation by Australia’s The Age and The Huffington Post said.

The report used data from a massive cache of leaked emails and corporate documents from 2001-2012 to unveil what it described as “the world’s biggest bribe scandal.”

The Ahsani family, Monaco millionaires Ata and his sons Cyrus and Saman, ran Unaoil as a sort of lobbying intermediary. They denied allegations of bribe paying.

“What we do is integrate Western technology with local capability,” Ata Ahsani told the investigation team.

Effectively, the report said of Unaoil: “Its operatives bribe officials in oil-producing nations to help these clients win government-funded projects. The corrupt officials might rig a tender committee. Or leak inside information. Or ensure a contract is awarded without a competitive tender.”

One of Unaoil’s biggest client was US engineering giant Kellogg Brown & Root (KBR), a former subsidiary of Halliburton, which operates in Azerbaijan and Kazakhstan.

In both Azerbaijan and Kazakhstan, KBR allegedly used Unaoil’s services to reach preferential deals and licences, mostly through personal connections and bribes to public officials.

KBR has not commented.

In Kazakhstan, leaked emails showed that Unaoil allegedly liaised with both Eni (codenamed “the spaghetti house”) and Kazmunaigas officials (codenamed “shashlik”) to secure tenders for KBR at the Kashagan offshore oil project.

Italian oil major Eni has not commented.

In Azerbaijan, both KBR and Swiss ABB allegedly won offshore oil contracts through insider information leaked by an in-country lead who had been bribed by Unaoil.

Swiss ABB has not commented.

After the report was published, police in Monaco raided the head- quarters of Unaoil. The FBI, the British Serious Fraud Office and the Australian Federal Police all launched major bribery investigations linked to the case.

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(News report from Issue No. 274, published on April 1 2016)

UAE detains ex-Kyrgyz President’s son-in-law

MARCH 23 2016 (The Conway Bulletin) – Authorities in Dubai detained Adil Toiganbayev, son-in-law of former Kyrgyz President Askar Akayev, who is wanted by Kyrgyzstan’s authorities for various crimes, including fraud, embezzlement, and tax evasion. Mr Toiganbayev’s alleged crimes are related to activities he conducted through his Aalam Services company before a revolution forced Mr Akayev to quit as president in 2005. Previously, Toiganbayev had been briefly detained in Moscow in 2014. It is still unclear if the UAE will collaborate with the Kyrgyz prosecutors.

ENDS

(News report from Issue No. 273, published on March 25 2016)

Netherlands extradites ex-Georgian spy

MARCH 22 2016 (The Conway Bulletin) – Giorgi Dgebuadze, a former high- ranking Georgian intelligence agent, was extradited to Georgia from the Netherlands. Mr Dgebuadze, who had served in the Constitutional Security Council, is wanted for charges related to the murder of three people in 2006. Dgebuadze had fled Georgia after the 2012 elections, triggering an Interpol manhunt. The Dutch police arrested Dgebuadze in 2014. The EU and the US have warned Georgia not to politicise its prosecution service.

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(News report from Issue No. 273, published on March 25 2016)