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FCPA Blog Daily News

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Wednesday
Oct032018

SFO moves to seize Karimova assets

The UK Serious Fraud Office said Wednesday it is trying to recover assets bought with money connected to corrupt deals in Uzbekistan.

"The claim concerns a number of assets, including three UK properties, which the SFO alleges were obtained using the proceeds of corrupt deals in Uzbekistan involving Gulnara Karimova and Rustam Madumarov," the SFO said

Karimova, 45, the eldest daughter of the late Uzbek President Islam Karimoa, allegedly took at least $300 million in bribes from Sweden's Telia Company AB and Amsterdam-based VimpelCom.

Rustam Madumarov, the other person named in the SFO action, has been described as Karimova's longtime boyfriend. He was reportedly sentenced to 10 years in jail in Uzbekistan in 2014 for stealing assets and tax evasion.

According to the Panama Papers, Madumarov owned multiple offshore companies.

In September last year, Telia agreed to pay $965 million to resolve FCPA offenses for bribery in Uzbekistan. Some of the settlement money was paid to Swedish and Dutch authorities.

In February 2016, Amsterdam-based VimpelCom reached a $795 million resolution with U.S. and Dutch authorities. The U.S. FCPA penalties amounted to $397.6 million.

Telia and VimpelCom admitted bribing Karimova to win mobile phone licenses.

The Uzbek Prosecutor General's office said Karimova was convicted of embezzlement in 2017 and is still in custody. She was placed under house arrest in 2014 in Uzbekistan's capital, Tashkent.

As many as 60 of her alleged associates have been convicted in Uzbekistan and sentenced to long prison terms for financial crimes.

The SFO said Wednesday it issued a claim for civil recovery in the High Court in London under Part 5 of the Proceeds of Crime Act 2002.

Karimova once served as Uzbekistan's ambassador to the United Nations. She also designed clothes and sometimes appeared on the catwalk.

In 2015, the DOJ asked authorities in several European countries to freeze about $1 billion in assets linked to her.

In a separate civil forfeiture complaint filed in June 2015, the DOJ listed more than $300 million in bank and investment accounts held in Belgium, Luxembourg, and Ireland.

The money was traceable to bribes or laundered money that VimpelCom and Telia paid to Karimova, the DOJ said.

The SFO said Wednesday no date has been set for a hearing in its action against Karimova's assets.

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Richard L. Cassin is the publisher and editor of the FCPA Blog.