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.