VimpelCom To Admit to Corrupt Practices in Uzbekistan
VimpelCom says it will “acknowledge certain violations of the US Foreign Corrupt Practices Act and relevant Dutch laws” in its fourth quarter report for 2015 published today.
corruption probe launched last year by the US Department of Justice (DOJ), the US Securities and Exchange Commission (SEC), and the Dutch Public Prosecution Service (Openbaar Ministerie or OM) resulted in prospective settlements. However, VimpelCom said the settlements are “subject to the approval of the pertinent authorities” and will not become final or announced until then.This development comes after discussions related to a
VimpelCom has been involved in talks with the DOJ about paying a near-record US$ 775 million to settle graft allegations involving the president of Uzbekistan’s eldest daughter, Gulnara Karimova, reported by Bloomberg last year.
US prosecutors allege corrupt business deals were made between VimpelCom and Takilant Ltd., a company registered in Gibraltar controlled by a “relative of the president of Uzbekistan,” according to documents obtained by Bloomberg. Karimova allegedly provided access to the country’s telecom market in exchange for bribes, according to two of Bloomberg’s sources involved in the probe.
According to the quarterly report, VimpelCom says it is headed toward “resolution” of its “potential liabilities in the ongoing investigations relating primarily to [its] business in Uzbekistan and prior dealings with Takilant Ltd.”
The Norwegian telecom firm Telenor, which holds a minority stake in VimpelCom, said in a news release that “corruption is unacceptable” and it “takes it very seriously” that VimpelCom "now seems to acknowledge" it violated the US Foreign Corrupt Practices Act and related Dutch laws.
VimpelCom says it “will make no further comments” on the prospective settlements and there is no assurance they will become effective. Telenor also says it will not comment further until they are approved and publicly available.
This story has been corrected to reflect the exact quote from Telenor's press release.