In bed with a dictator’s daughter — again
17 Sep 2020

By Ola Westerberg, Joachim Dyfvermark and Sven Bergman, OCCRP, 16 September 2020

OCCRPThe tall Swede was insistent as he spoke to journalists and analysts in his characteristically deep, rumbling voice: “I have said it before and I will repeat it: TeliaSonera did not bribe anyone.”

Lars Nyberg, then the CEO of the Swedish telecom giant, was speaking at a press conference in Stockholm in October 2012.

Prosecutors had just launched an investigation into Telia in response to a story Sweden’s national broadcaster SVT had aired the previous month in collaboration with OCCRP. The film showed that the company had paid hundreds of millions of dollars in bribes in exchange for telecom licenses in Uzbekistan.

The recipient of the money, Gulnara Karimova — characterized as a “robber baron” in a U.S. diplomatic cable — was the extravagant daughter of the country’s president at the time, Islam Karimov, who died in 2016.

But even as Nyberg was making his public assurances, Telia was secretly negotiating another payoff to Karimova, and even adjusting the technical arrangements on the fly to account for the unwelcome newfound publicity.

This is revealed in new records obtained by OCCRP and SVT’s flagship investigative program, Uppdrag Granskning (“Mission: Investigate”). The new evidence includes emails, contracts, bank statements, and testimonies gathered around the world, including some collected by U.S. authorities. Some files were read out loud to reporters; they were able to photograph others.

This documentation shows that Telia intended to pay an additional $20 million “protection fee” to Karimova, and that at least $12 million was indeed paid. One middleman in the transactions was ZTE, a Chinese telecoms and electronics company dogged by persistent allegations of corruption. Nyberg and other executives approved the arrangement, a senior manager told investigators.

“Telia never ceases to amaze me,” a lawyer specializing in anti-corruption, Peter Utterström, said on reviewing the new evidence. He recalled Nyberg’s press conference: “Of course it is very, very inappropriate to say something like that when it’s unlikely that he doesn’t know what’s happening behind the scenes.”

Pulat Ahunov, a well-known Karimov critic living in Sweden, put it more bluntly: “They say ‘we didn’t do it,’ and at the same time they give orders to give more money to Gulnara Karimova. It’s such a cynical lie.”

Despite his determined press conference, Nyberg soon left the company as a result of the scandal.

The affair was then investigated in a handful of countries. In 2017, Telia reached a settlement with American and Dutch authorities , admitting to bribing Karimova and agreeing to pay $965 million in fines and penalties — arguably the highest such payment in U.S. history.

That same year, Nyberg and two other former executives were indicted in Sweden. But the men walked free. The case against them had floundered on a technicality: The court found that, though Telia had indeed paid Karimova off, she was not a public servant formally in charge of decisions about telecommunications. As a result, the payment did not count as a bribe under Swedish law then in place.

This is why the new evidence is of great significance in Sweden. The crime of “trading in influence” was introduced in Swedish law in July 2012 to cover illicit payments to people with informal power to influence government decisions. The “protection fee” was just a fraction of the previously known bribes — but it was paid to Karimova after this date, making the new law applicable.

OCCRP and SVT found that Swedish prosecutors had been made aware of this information, but did not use it. Contacted by reporters, the prosecutor who led the case, Gunnar Stetler, did not say whether he investigated the “protection fee,” but said that any payments beyond the ones he was using would not have made a difference in the case. He did not go into details, citing confidentiality.

However, three experts who reviewed the evidence agreed that this information could have made the prosecutors’ case much stronger.

“It is of course impossible to say if [using the new evidence] would have led to convictions, but one would have had a different situation. One would not have had the same problem, that the president’s daughter was a person who could not be bribed,” said Natali Engstam Phalén, Secretary General of the Swedish Anti-Corruption Institute.

Read more at OCCRP

Photo (cropped and edited): Holger.Ellgaard/CC BY-SA 3.0

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