MTS will pay on the Uzbek account

The company was fined $ 850 million due to "corruption ties" with the daughter of Islam Karimov

The largest Russian telecommunications operator MTS has concluded a settlement agreement with the American authorities - the Ministry of Justice and the Securities Commission - and will pay the United States $ 850 million. This amount is a punishment for violation of the law on corruption abroad: the “daughter” of MTS was accused of giving bribes in Uzbekistan. “The penalty will be paid from the funds that were reserved by MTS following the results of the third quarter of 2018,” the operator’s press service said in an official message.

How are Uzbekistan, the USA and MTS, are generally interconnected? To understand this, you need to return to 2004, when MTS bought a company of communication called Uzdunrobita in Uzbekistan and introduced its brand into the country's market. Until 2012, it was the most successful cellular company of the republic (Ferghana edition evaluates its coverage of 10 million subscribers - a third of the entire population of Uzbekistan). But in the spring of 2012, the country's authorities conducted an unscheduled comprehensive check of MTS-Uzbekistan and discovered

"Inappropriate use of funds, the extension of the property, as well as illegal schemes for cash and tax evasion."

The Russian company immediately distant from the "daughter" and announced the intention to help the authorities of Uzbekistan, as "values ​​with its honest name." However, then the country's authorities de facto nationalized the company, the equipment was idle for a year and a half, and in 2013 the court recognized MTS-Uzbekistan bankrupt. Then MTS was already on the attack on the Uzbek authorities, filed a lawsuit at the International Center for Settlement of Investment Disputes at the World Bank. After another year, MTS and Uzbekistan seemed to have officially reconciled, and the company returned to the country's telecommunications market-though 49.99% of MTS-Uzbekistan shares now belonged to the state.

The peaceful coexistence of the two shareholders violated the US authorities, which in 2015, after a large investigation from OCCRP, began their own anti -corruption actions against Vimpelcom and MTS, presented in Uzbekistan with their “daughters”. In addition, MTS shares were located on exchanges in the United States, so any actions fall under American jurisdiction. The Ministry of Justice blocked 300 million dollars of companies lying on the Bank of New York Mellon Corp: this money, according to the US authorities, was intended for the eldest daughter of the then President Karimov Gulnara.

With the help of fictitious schemes and bribes to the Karimov family, the Ministry of Justice said, the companies initially sought access to the Uzbek market. MTS, in particular, placed a $ 20 million deposit in Uzbekistan in Uzbekistan, and then this money was simply written off at a loss in Uzbek. It is believed that Gulnara Karimova received this money - at that time the main “holder” of the entire telecommunications system of the country.

Almost all mobile operators entering the market of Uzbekistan were supposed to give money to the presidential daughter: OCCRP estimated the total income of such actions at $ 980 million.

“Already in the two thousand years it was clear that Karimova put a hand in the telecommunications business, she controlled the sunsers of all large foreign companies to the market (there were three of them),” says the publisher of Ferghana Daniil Kislov. - It was a kind of corvation, given to her, probably, to her father. The companies themselves did not have any other choice but to pay Karimova. ”

In the era of Islam Karimov, who died at the end of the summer of 2016, all spheres of life in the country were divided between his closest associates and relatives, so that what was happening was perceived as a normal order of things, Kislov explains, one could “milk” his “cow”. But it was the appetites of Gulnara in telecommunications that became destructive to her. In 2012, the Swedish prosecutor’s office began an investigation on the corruption connections of the Finnish-Swedish company Teliasonera in Uzbekistan, and when the name Gulnara Karimova surfaced, her father laid with all the sins on her father’s table.

“Karimov considered that the actions of Gulnars can harm the state (that is, to himself), so the go -ahead was given for its persecution. All assets were taken from her, then they placed under house arrest, and now at first they gave one period, and then the other. No one in such a situation, in principle, was no longer thinking of entering her, ”Kislov explains.

In other words, if Karimova had not fallen into disgrace to her own father, even the investigation of the US Ministry of Justice would not have inflict so much damage to those companies that could give bribes to the daughter of the Uzbek president. And so the Uzbek authorities themselves had no more interest to protect the established order in the telecommunications market (moreover, there is much more in Uzbek politics, according to Kislov, “changes”).

In 2016, MTS left the Uzbek “daughter”, having sold their share of 50.01% of the state for a “symbolic price”, and this, apparently, was one of the conditions for concluding an agreement with the US Ministry of Justice, which the company eventually arrived in March 2019.

MTS promises that such a situation will never happen again. “MTS commitment to the highest ethical standards for doing business will be the guarantor of the impossibility of repeating the situation that caused the conclusion of this settlement agreement and will help strengthen the leadership positions of the company in the presence markets,” the company quotes its president Alexei the root.

In order for these words to become a reality, an independent audit will have to take place for three years. But it can be assumed that such an Uzbek situation is unlikely to be repeated. This is no longer a matter of image, but pure pragmatics: due to the need to reserve money for the payment of a MTS fine in the third quarter of 2018, received a pure loss of 37 billion rubles.