Monthly Archives: September 2012

Uzbekistan: Swedish Police Open Corruption Probe into TeliaSonera Claims

Uzbekistan is facing a second corruption investigation in Europe, as Swedish police open a graft probe into claims that Swedish-Finnish telecoms giant TeliaSonera paid hundreds of millions of dollars in bribes for the rights to operate in Uzbekistan. The case is allegedly linked to a money-laundering investigation in Switzerland.
TeliaSonera (whose largest shareholders are the Swedish and Finnish states) said that Swedish police are investigating allegations of “bribes and money laundering” involving Uzbekistan. The allegations surfaced in a September 19 documentary on Swedish broadcaster SVT.
“We can confirm that the Swedish police has collected information from TeliaSonera regarding Uzbekistan,” TeliaSonera – which owns the Ucell mobile phone company in Uzbekistan – said in a statement on September 26. It said that the company had already announced an external review “regarding the allegations of bribes and money laundering” and that now the Swedish Prosecuting Authorities’ anti-corruption unit had launched its own probe, “which we welcome.”
TeliaSonera has denied any wrongdoing but pledged to “cooperate fully” with the Swedish investigation, which follows SVT’s allegations that the firm paid hundreds of millions of dollars to “a small, one-woman company in a tax haven” for the rights to operate in Uzbekistan. The company, Takilant Limited, is run out of Gibraltar by Uzbekistan national Gayane Avakyan.
Avakyan, SVT said, is “very close to the Uzbek dictator’s daughter Gulnara Karimova, and is also the focus of a major money laundering investigation recently launched by Swiss authorities.” EurasiaNet.org could not reach Avakyan for comment.
Under that probe involving four Uzbek nationals, hundreds of millions of francs have been frozen in Swiss banks. The Swiss Attorney General’s Office has confirmed to EurasiaNet.org the arrest of two Uzbek citizens.
These developments follow Uzbekistan’s appropriation of the business of Russian cellphone giant MTS this summer, amid allegations of wrongdoing by Tashkent that the company denies.
The troubled few months on Uzbekistan’s telecoms market have underlined the risks for investors of sinking their money into what should in theory — as the region’s most populous state — be Central Asia’s most lucrative market. Moves to reassure investors (such as a new law to guarantee property rights) notwithstanding, the news that two corruption investigations involving Uzbekistan are being pursued in two different European states will further taint the country’s investment climate.
www.eurasianet.org

TeliaSonera Discloses Money Laundering Probe

The anti-corruption unit of the Swedish prosecutor’s office has launched a probe into a deal by TeliaSonera in Uzbekistan following allegations of money laundering, the Swedish telecom operator said Wednesday.

A program on Swedish Television, the country’s public broadcaster, last week alleged TeliaSonera had been involved in money laundering in relation to the acquisition of an Uzbekistan wireless data license, spectrum frequencies and number series from Gibraltar-based Takilant Ltd. in 2007, according a Dow Jones Newswires story.

TeliaSonera said that it welcomes the investigation by the prosecutor’s office. It added it had been contacted by Swedish police, and has provided them with information regarding its Uzbek operation.

The company had earlier denied the allegations made in the television program and said it had launched its own investigation into the matter.

blogs.wsj.com

Gayane Avakyan and TeliaSonera or Swedish Krona for Googoosha

On 19 September a Swedish public television current affairs program called Mission: Investigate (Uppdrag granskning) by journalists Sven Bergman, Joachim Dyfvermarkand and Fredrik Laurin, reported on Swedish telecommunications company TeliaSonera’s entrance to Uzbekistan.According to the programme, TeliaSonera paid $320 million to Gibraltar-based company Takilant Ltd, a “local Uzbek partner”, in exchange for 3G licenses and a series of Uzbek phone numbers, which allowed it to start operating in Uzbekistan.

TeliaSonera confirms buying assets from Takilant, but the sums of money mentioned are wildly different. The company said that it “concluded an agreement with Takilant Ltd on acquiring 3G licences, and a series of Uzbek phone numbers in exchange for $30 million USD and 26% of Ucell. The purchase of these assets is a necessary condition to begin working and carrying out communications operations in the country.”

Who is behind Takilant?

Gayane Avakyan, an Armenian woman born in the mid-eighties and active in the fashion scene in Uzbekistan, is the sole owner of Takilant, the offshore company, according to the documentary. She is said to be “Googoosha” (Gulnara Karimova), the Uzbek president daughter’s “right hand”.

The full version of the programme is already available on this link

Takilant has its own subsidiary in London called Panally, the secretary of which is on the board of another company, Odenton Management Ltd, which in turn belongs to Gulnara Karimova’s husband. Another Panally director is a woman called Katja Klyueva, who is also head of “House of Style”, founded by Gulnara Karmiova in 2003. Ms Avakyan also headed House of Style several years ago.

Kamoliddin Rabbimov, an Uzbek political analyst living in France says that Avakyan i”is Gulnara Karimovaґs closest confidante. They are so close that some five years back Avakyan was put in charge of Gulnaraґs financial matters.”

Swiss authorities became aware of Ms Avakyan when they opened a large investigation into suspected money-laundering.

Earlier this year, in July 2012, two citizens of Uzbekistan, who were working at Coca-Cola Uzbekistan, were arrested in Geneva. Coca-Cola Uzbekistan is also part of Ms Karimova’s empire, because Coca-Cola Icihmligi Uzbekiston Ltd, Central Asia’s biggest plant, was established by her former husband. As Fergana previously reported, it is the managers of this company that carry out Ms Karimova’s personal financial operations in the West and those arrested were part of Ms Karimova’s “inner circle”.

The arrests were connected to a scandal-filled investigation of large-scale money laundering. Gazeta.ru reported that as part of this investigation, several Uzbek citizens linked to the country’s authorities were arrested on 19 September in Switzerland. According to French publication Le Temps, nearly $600 million were frozen and Romandie.com reports that the money was frozen in several Swiss banks.

Pay the offshore company and get a license

Representatives of TeliaSonera said several times that Takilant has no relations with the authorities of Uzbekistan. However, Cecilia Edström, TeliaSonera Senior Vice President and Group Communications Manager, practically confirmed the $320 sum. Here is a fragment of the interview:

Gayane Avakyan and TeliaSonera are at the centre of a money-laundering investigation in Switzerland. TeliaSonera is just as involved in the investigation. Did you bribe Gulnara Karimova and the Uzbek authorities?

Cecilia Edström: We paid the company which was the rightful owner of the frequencies and licenses, in order to begin our own operations in Uzbekistan. We checked that the person representing the company had the right to do this, but we did not manage to clarify whether any other persons were behind the company, and if they did, who they were.

Why did you pay 2.2bn Swedish Kronas ($320 million) to the Gibraltar offshore company for a license you are getting from the government of Uzbekistan?

C.E.: The assets that were necessary to start operations belonged to another company and we used legal means, which are accepted in Uzbekistan. Owners cannot buy licenses from each other, they must return the licenses and numbers to the Uzbek government, which in turn makes them available to the new operator.

So you paid an offshore company 2.2 Swedish Kronas and then got the license from the Uzbek authorities?

C.E.: We paid the legal owner of the license. This is a formal process: the licenses were returned to the Uzbekistan authorities, who then gave them to us.

It is worth noting that in the reports presented by Takilant to the Gibraltar authorities, and carefully studied by journalists, do not contain a single mention of the large sums paid by TeliaSonera in cash and security papers.

Gulnara Karimova and Gayane Avakyan at Paris Fashion Week in 2012. Photo by © Getty Images

Former investigator Lars Hammar, who has many years of experience in investigating financial crimes, said that these circumstances arouse suspicion. “It can all look like the money went to the president’s daughter. And I think that every Swede understands that this while thing is not clean.”

Uzbek lawyers have explained that telecommunications licenses are given out by the Uzbekistan authorities and cannot be sold. The president’s daughter has no formal connection to the country’s telecommunications market, but the documentary’s authors concluded that it is her who regulates the licences and decides who gets the income from profitable contracts. The US State Department’s confidential reports published by Wikileaks, say that people call the president’s daughter “a robber baron”.

The Swiss authorities are investigating the links between TeliaSonera and Takilant, according to the documentary. Nobody from TeliaSonera has yet said that the payments to the Gibraltar company were part of a money laundering scheme. “We would have never done that”, says TeliaSonera chairman Tom von Weymarn.

Tom von Weymarn

TeliaSonera prefers to work using unspoken rules established in their country of operations. The company was accused to working with security services in CIS countries by journalists in April 2012. The media had uncovered that TeliaSonera gives the authorities’ strongmen information on calls made by their clients (including journalists, the opposition, activists and ordinary citizens) without adhering to the existing legal procedures. Also, the security services are said to have real time access to the voices and data of those on the TeliaSonera network and can get full information on anybody’s correspondence, calls, location and movements. At the time, the company announced that it has to adhere to the rules where it operates.

The full version of the programme is already available on this link

Fergana would like to thank its Swedish colleagues for their information and supports them in their investigation. The information agency hopes that the truth about the dubious deals made by European companies with people from the Uzbek president’s inner circle will emerge soon.

enews.fergananews.com

 

TeliaSonera billion deal with a dictatorship

TeliaSonera has paid out billions to a sole proprietorship in Gibraltar, owned by a woman from the Uzbek fashion scene in exchange for mobile phone licenses in Uzbekistan. Mission examination can now reveal that the woman standing very close to the Uzbek dictator’s daughter and that Swiss authorities launched an unprecedented economic crime investigation where the woman, her company, the dictator’s daughter and TeliaSonera included. Prosecutors have already frozen accounts with very large amounts are suspected to belong to the dictator’s daughter.

This spring could Assignments examination reveal how TeliaSonera secretly collaborated with the security services in some of the harshest dictatorships. One of the countries where they let in the security services in their own switchboards were Uzbekistan, where the family Karimov rules with an iron fist for 20 years.

When telecom giant TeliaSonera, the Swedish government as the largest shareholder, established in Uzbekistan six years ago they released into what was called “a local partner.” For the partner, the Gibraltar-based company Takilant Ltd, TeliaSonera has since been paid out over 2.2 billion in exchange for 3G licenses and telephone lines in Uzbekistan.

The owner of the company, which, according TeliaSonera is the one who received the money, is a young woman from the fashion world in Uzbekistan, Gayane Avakyan. Assignment review-mapping now shows that she has strong ties to the Uzbek dictator’s daughter Gulnara Karimova and Avakyan is the central figure in a gigantic financial crime investigation in Switzerland.

The investigation started in July this year when two people standing near the president’s daughter was arrested outside the venerable bank Lombard Odiers office in Geneva, Switzerland. So far, investigators freeze large amounts in Swiss accounts suspected to belong to the dictator’s daughter Karimova. Although the investigation is still in its infancy, has already seized larger amounts than is the case in all investigations against the dictators who fell in the Arab Spring.

The dictator Islam Karimov’s eldest daughter Gulnara Karimova has many faces: a pop star, a professor, diplomat, fashion icon – is a business woman with great influence. In fact, she is one of the regime’s most powerful people. Formally, she has no power over the country’s telecom market – Gulnara Karimova but singled out as the one who controls and shoes on the lucrative telecommunications contracts.

In documents leaked from the American Foreign Service via WikiLeaks described her as a “robber baron” and according to consistent sources, she is the one to approve who can establish themselves in the Uzbek market.

It is also the only Uzbek authorities may grant licenses – still TeliaSonera has paid out billions of dollars to a small, private company in a tax haven to get over licenses – according to TeliaSonera’s a perfectly normal process.

Group representatives have repeatedly defended the deal, saying that it carefully examined its local partner – and that this has no connection to the regime. But when orders audit finds Takilant partner in the tax haven of Gibraltar and a closer look at the parts of the report that is public is not a trace of the 2.2 billion that TeliaSonera paid in cash and shares.

The former detective inspector Lars Hammar, with many years experience of major economic crime investigations, believes that the warning bells ringing immediately when he sees layup.

– It may well indicate that this money went to the president’s daughter. I think every single Swedish understands that when it is not sound business behind, says Lars Hammar.

Although TeliaSonera paid billions to Takilant Ltd and Gayane Avakyan state company for Mission examination that none of the group management even met Avakyan.

Gayane Avakyan Takilant and is now the focus of a major police investigation Switzerland as regards money laundering. These include TeliaSonera, which include Takilant. Have you bribed Gulnara Karimova and denuzbekiska regime?

– We have paid money to a company that was the rightful owner of frequencies and licenses in Uzbekistan that we needed to operate telecom operations in the country. We have investigated that the person who represented the company had a mandate to do so and, in addition, we have not been able to substantiate whether there were any other people behind or who they were, says Cecilia Edstrom, Communications Director at TeliaSonera.

Why did you pay 2.2 billion for an offshore company in Gibraltar for a license you get the Uzbek authorities?

– They had an asset we needed to conduct our business and we followed the legal process, the formal process in Uzbekistan, where one can not transfer licenses between owners but must return them to the authorities who then in turn issue them to another operator, says Cecilia Edström.

So you pay an offshore company 2 billion and then you get a license from the authorities?

– We paid the rightful owner of the licenses and the formal time is that the licenses then goes back to the authorities who then issued the licenses again, says Edstrom.

Mission review has sought Gulnara Karimova and Gayene Avakyan for comment through multiple channels. They have not come back with a comment.

www.svt.se

Uzbekistan: Nordic Telecom Accused of Paying Off Googoosha Crony

Once again a foreign telecoms firm in Uzbekistan is at the heart of an international scandal, and this time the trail leads back to a close associate of Gulnara Karimova’s.
An investigation to be aired September 19 by Swedish public broadcaster Sveriges Television (SVT) charges that Swedish-Finnish mobile giant TeliaSonera has paid hundreds of millions of dollars to a shady offshore firm for the rights to operate in Uzbekistan. Karimova, the daughter of Uzbekistan’s dictator Islam Karimov, is close to the action, says SVT’s Uppdrag Granskning (“Mission Scrutiny”) program.
TeliaSonera, which is 37 percent owned by the Swedish government, started operating in Uzbekistan in 2007. In order to work there, the company relied on a partner called Takilant Limited, which is based in Gibraltar and run by an Uzbekistan national named Gayane Avakyan.
Uppdrag Granskning reports that Avakyan has strong links to Karimova. Her name appears frequently in association with Gulnara’s pet fashion projects. And Radio Ozodlik has quoted sources calling Avakyan very close to Karimova, adding that she manages the first daughter’s finances.
Over the course of six years, SVT says, TeliaSonera has paid Takilant 2.2 billion Swedish krona ($336 million) in exchange for 3G licenses, mobile frequencies and phone numbers in Uzbekistan. But, the program notes, the money cannot be accounted for in public financial records.
In a September 19 statement, TeliaSonera said it gave Takilant $30 million plus a 26 percent share in Ucell (the mobile network TeliaSonera runs in Uzbekistan), in order to work in the country.
The statement says TeliaSonera carried out a background check on Takilant and determined “that the persons representing the company had the mandate to do so. TeliaSonera has no insights into how Takilant has used the proceeds, or whether there are any connections to other persons in Uzbekistan.”
In 2010, TeliaSonera bought out the majority of Takilant’s shares, increasing its ownership of Ucell from 74 to 94 percent, according to state-operated UzDaily.com. Over the past five years, Ucell has reportedly grown from 500,000 to 9 million subscribers.
The program, which alleges that investigators in Switzerland have frozen bank accounts that are suspected of belonging to Karimova or persons close to her, should shed light on her assets in the tax haven. The Karimov clan’s Swiss accounts have been under scrutiny since a small, unusual protest outside the Swiss Embassy in Tashkent in early August, which regional news site Centrasia.ru has tried to use to link Karimova to several Uzbek nationals arrested for money laundering in Switzerland.
The Swiss Attorney General’s Office has confirmed to EurasiaNet.org that two Uzbek nationals have been arrested as part of a money-laundering probe and two others are being investigated.
Wikileaked US Embassy cables have described Karimova as “the single most hated person” in Uzbekistan and a “robber baron,” though she styles herself a fashion designer and pop diva. Her many critics say Karimova, who sings under the stage name Googoosha, is a vapid jetsetter who uses her father’s dictatorial regime to thrust herself into the limelight. Last month she held a widely ridiculed press event where she thanked God for “my height, my face, my features.”
The TeliaSonera scandal comes as the Karimov regime is under fire for seizing $700 million worth of assets from leading Russian telecom MTS. Tashkent has charged four employees of MTS’ subsidiary, Uzdunrobita, of fraud, though many believe the case is an attempt by someone well-connected in Tashkent to snatch a profitable business.
This is not the first time TeliaSonera has been accused of cozying up to an authoritarian regime. The controversial multinational was at the center of an earlier SVT investigation that found TeliaSonera had provided the security services in repressive countries such as Azerbaijan and Belarus access to phone records in exchange for operating licenses.
TeliaSonera has recently been under fire in Tajikistan, too, for helping the government cut off Internet and mobile phone connections with the restive east. Activists say there was no court order for the cut to be made and thus argue that TeliaSonera was breaking the law. TeliaSonera owns a majority stake in Tcell, one of Tajikistan’s top mobile providers.
In its September 19 statement, TeliaSonera said it would comment further after SVT’s Uppdrag Granskning program has aired. It seems there will be many questions to answer.
www.eurasianet.org