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US authorities seek seizure of USD1bn assets in Uzbek telecoms probe

17 Aug 2015

US authorities have requested that European counterparts seize around USD1 billion in assets in Ireland, Luxembourg, Belgium, Sweden and Switzerland related to a criminal investigation of alleged corruption by three global telecoms companies and intermediaries close to the daughter of Uzbekistan’s president, the Wall Street Journal reports citing court documents and people with direct knowledge of the probe. US prosecutors believe Amsterdam-based Vimpelcom, Mobile TeleSystems (MTS) of Russia and Sweden’s TeliaSonera funneled hundreds of millions of dollars to businesses controlled by Gulnara Karimova, daughter of Uzbek President Islam Karimov, in an effort to secure wireless frequencies and other deals in Uzbekistan between 2004 and 2011. However, no company or individual has been charged as part of the US or European investigations into the matter.

The three telcos disclosed last year that they were cooperating with investigations by the US Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) in connection with their operations in Uzbekistan. Vimpelcom and MTS securities trade in the US, whilst although TeliaSonera delisted its US securities in 2004, the Swedish firm could still be subject to US oversight in respect to any deals involving the US financial system, experts quoted by the WSJ claimed. The US intervention might speed up the far-reaching international probe, which European magistrates indicate has been slowed down due to difficulties of cross-border judicial cooperation, the WSJ adds. The DOJ’s investigation has targeted Ms Karimova as well as the three international telecoms groups.

Uzbekistan, Mobile TeleSystems (MTS), Telia Company, VEON

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