This post highlights FCPA enforcement actions concerning conduct (in whole or in part) in Uzbekistan.
Three related large (from a settlement amount standpoint) enforcement actions concerning the Uzbekistan telecommunications sector lead the list.
The enforcement action concerned conduct in Uzbekistan and the allegations were: “From 2004 to at least 2012, MTS offered and paid bribes in violation of [FCPA] to a government official [Gulnara Karimova “a family member of the former President of Uzbekistan and was herself an Uzbek government official. She had influence over decisions made by UzACI, the regulatory authority governing telecommunications in Uzbekistan] in Uzbekistan in connection with its Uzbek operations.
The improper payments enabled MTS to enter the Uzbek market, to operate as a telecommunications provider, and to receive commercial benefits to its operations. […] During the course of the scheme, MTS made at least $420 million in illicit payments for the purpose of obtaining and retaining business, and those payments generated more than $2.4 billion in revenues. These illicit payments were made through a variety of means, including equity transactions with the government official, sham contracts, and in the form of charitable contributions or sponsorships at the direction of the government official. These payments were improperly characterized as legitimate expenses in MTS’s books and records. MTS filed its financial statements, incorporating the falsely recorded payments, with the Commission throughout the relevant period.
In connection with the same core conduct, the DOJ also brought FCPA and related criminal charges against Bekhzod Akhmedov (a citizen of Uzbekistan and former executive of an MTS entity) as well as money laundering charges against Gulnara Karimova.
The enforcement action concerned conduct in Uzbekistan and involved the same core allegations. “From 2007 to at least 2010, Telia paid bribes to a government official in Uzbekistan in order to obtain and retain business that generated more than $2.5 billion in revenues for Telia. During the course of the bribery scheme, Telia made at least $330 million in illicit payments. These bribe payments were made to the Uzbek official to enable Telia to acquire a United States-based telecommunications company with operations in Uzbekistan and enter the telecommunications market in Uzbekistan. The bribe payments were funneled through payments for sham lobbying and consulting services to a front company controlled by the official.”
The enforcement action concerned conduct in Uzbekistan and involved the same core allegations. “From 2006 to at least 2012, VimpelCom offered and paid bribes to a government official in Uzbekistan in connection with its Uzbek operations. During the course of the bribery scheme, VimpelCom made or caused to be made at least $114 million in improper payments in order to obtain and retain business that generated more than $2.5 billion in revenues for VimpelCom. These payments were primarily made through sham contracts, but were also, in certain instances, made under the guise of legitimate charitable contributions or sponsorships. These payments were improperly characterized in the books of records of VimpelCom’s subsidiaries as legitimate expenses, and consolidated in VimpelCom’s financial statements which were filed with the Commission throughout the relevant period.”
The enforcement action concerned conduct in Uzbekistan and involved commission payments to an Uzbekistan agent to receive confidential bidding documents in connection with tenders conducted by Uzbekistan state-owned or state-controlled companies [OAO “was a wholly owned subsidiary of Uzbekneftegaz, the state holding company of Uzbekistan’s oil and gas industry”]. Tenaris employees “were aware or substantially certain that all or a portion” of the commission payments would be offered by the Agent to employees at the SOEs and that certain of the payments were paid via a wire transfer through a New York bank account.
The enforcement action concerned conduct in at least 22 countries – including China, Croatia, Egypt, Greece, Hungary, Indonesia, Iraq, Ivory Coast, Latvia, Nigeria, Russia, Serbia and Montenegro, Thailand, Turkey, Turkmenistan, Uzbekistan, Vietnam.
The charging documents do not contain any specific allegations regarding Uzbekistan.
The enforcement action concerned conduct in Kazakhstan, Indonesia, Angola, Russia, Uzbekistan, and Nigeria.
As to Uzbekistan, the allegations were: “from 1998 to 2004, Baker Hughes authorized commission payments of nearly $5.3 million to [an] agent (who worked in Kazakhstan, Russia and Uzbekistan) under circumstances in which the company failed to determine whether such payments were, in part, to be funneled to government officials in violation of the FCPA.”
