The US government wants to recover hundreds of millions of dollars in allegedly illicit funds that American prosecutors contend enriched a “close relative” of Uzbekistan’s strongman president, Islam Karimov.
A forfeiture complaint filed in US federal court in New York seeks the recovery of $300 million in assets “involved in an international conspiracy to launder corrupt payments” made in Uzbekistan’s telecoms sector, according to a copy of the complaint sent to EurasiaNet.org by the Department of Justice, which filed the case on June 29.
It alleges that illicit payments were made by two telecoms companies, Russia’s MTS and Amsterdam-based VimpelCom, to curry influence and secure favorable decisions from Uzbekistan’s government to operate in the lucrative telecommunications sector.
The alleged beneficiary is not named, but is identified as “GOVERNMENT OFFICIAL A,” and is further characterized as “a close relative of the President of Uzbekistan.” The unnamed beneficiary “held several positions in the Uzbek government” during the period in question (2004-2011), according to the complaint.
Gulnara Karimova, the president’s eldest daughter who is under house arrest in Uzbekistan on corruption charges, has previously been named as a suspect in a money-laundering probe in Switzerland involving payments in Uzbekistan’s telecoms sector. During the period in question, she held government positions, including as deputy foreign minister and ambassador to Spain and the United Nations in Geneva.
The lawsuit names two Karimova associates, and two shell companies they allegedly operated to funnel illicit funds: Gayane Avakyan, owner of Takilant, and Rustam Madumarov, owner of Expoline.
Takilant and Avakyan are at the heart of an ongoing graft probe in Sweden into allegations that Nordic telecoms giant TeliaSonera made dubious payments in order to gain the right to operate in Uzbekistan.
Karimova is a suspect in a money-laundering investigation in Switzerland, in which Takilant and Avakyan also feature. The Swiss investigation is looking into possible illicit payments made in Uzbekistan’s telecoms sector that may have been laundered through Swiss banks.
According to the US lawsuit, Takilant and Expoline were among shell companies “beneficially owned by GOVERNMENT OFFICIAL A,” which were used to “conceal his/her involvement in corruption and to mask the true sources of his/her wealth.”
“As we have disclosed in our filings with the [Securities and Exchange Commission], VimpelCom had prior dealings with Takilant related to our business in Uzbekistan,” spokesperson Rozzyn Boy told EurasiaNet.org by e-mail. “We continue to cooperate with the authorities in their investigation and given that these are still ongoing, we cannot comment further.”
MTS declined to comment.
The US lawsuit alleges that “the corruption proceeds were laundered in a complicated series of transactions, including the purchase of investment portfolios and assets in Ireland, Luxembourg, and Belgium.” These processes allegedly involved transferring money into and out of accounts held at US financial institutions.