It’s no secret that Central Asia is one of the most corrupt regions on the planet. Among the 175 nations surveyed in Transparency International’s most recent Corruptions Perceptions Index, only Kazakhstan landed within the top 130, coming in at 126th place. Awash in nepotism, strong-arm tactics, and heavy-handed statism, Kyrgyzstan (136), Tajikistan (152), Uzbekistan (166), and Turkmenistan (169) have helped turn Central Asia into one of the most corruption-prone regions this side of the Horn of Africa.
Nonetheless, wholesale looks into the depths of regional corruption are relatively few and far between. (There’s little coincidence that such corruption dovetails with wide-scale media repression.) As such, last week presented a rare glimpse into the inner workings of the region’s first families. A pair of reports helped illustrate the preferred methods of the first families, both current and former, for swindling billions from the broader populations.
First, the Organized Crime and Corruption Reporting Project (OCCRP) unveiled a remarkable look into the massive operations Gulnara Karimova, daughter of President Islam Karimov, spearheaded over the past decade. According to documents OCCRP obtained, “Karimova received more than US$1 billion worth of payments and ownership shares out of international telecom-related companies.” And that figure may not be final: “Even the US$1 billion figure likely underestimates the true magnitude of the alleged extortion and bribery she received because most records of her business records have not been released.”
The bulk of the findings stem from telecom companies to which Karimova was already tied, including Swedish-Finnish operator TeliaSonera and Russian-Norwegian operator VimpelCom. As OCCRP uncovered, “TeliaSonera paid US$381 million and promised an additional US$75 million; VimpelCom and its Russian mother company Alfa Telecom paid US$176 million; the Russian giant MTS paid US$350 million. She also received nearly US$90 million from two other companies that ran fiber optic lines and provided WiMAX and WIFI services in Uzbekistan.” Many of the payments strung together offshore investments and concealed connections. But some stemmed directly from the racketeering all too familiar through the region. For instance, Karimova demanded $15 million from TeliaSonera for protection “against five regulatory bodies.” Some of those funds found their way into the lavish property now tied to Karimova.
The report caps an extraordinary fall from grace over the past year for Karimova. Once positioned as her father’s potential successor, Karimova has languished under house arrest for months, assets seized both near and abroad, seemingly turning into an afterthought within the Uzbek political scene. There’s little telling what’s become of the $1 billion (or more) Karimova has allegedly laundered and extorted through the years, but her political career appears all but finished.
Still, Karimova may be able to take comfort in knowing that the region’s other princelings can apparently continue to live large even after their political aspirations dry up. A new report from Global Witness shone light on the current situation of Maxim Bakiyev, the loathed son of Kyrgyzstan’s former autocrat Kurmanbek Bakiyev. After the country’s 2010 revolution ran the Bakiyev claque out of Kyrgyzstan – Kurmanbek brought his brother to Belarus, and Maxim absconded to the United Kingdom – documents and financial records began surfacing, illustrating the depths of the Bakiyevs’ corrupt practices. Global Witness detailed the myriad methods in “Grave Secrecy,” a full-length report published in 2012.
At the time of the report’s release, Maxim faced potential extradition to the United States for charges relating to his father’s reign in Kyrgyzstan. Since then, however, Washington has dropped extradition attempts – and as Global Witness’s update illustrates, Maxim continues to live a life of comfort in London. As Global Witness writes, Maxim “lives in a £3.5 million Surrey mansion that was purchased by an ‘anonymous company’ (a company registered in an offshore secrecy jurisdiction whose laws hide the company owner’s true identity) less than two months after [Maxim] arrived in the U.K. by private jet and claimed asylum. This anonymous company can be linked to an alleged money-laundering scheme used to funnel state funds out of Kyrgyzstan.” The company, Limium Partners Limited, registered in Belize, lists the same address as another company that “allegedly transferred US$30 million out of Kyrgyzstan around the time of the Kyrgyz uprising.”
As to how and why Maxim managed to land a $5.2 million mansion without any potential red flags appearing, Global Witness was unable to discern. Real estate and legal professionals connected to the deal claimed confidentiality or ignorance. Maxim, unsurprisingly, did not respond to Global Witness’s questions. Maxim has said little since his ousting five years ago, and there’s little reason to think that will change. And so we have to rely on these reports – from OCCRP, from Global Witness – to help bring to light the billions allegedly swindled by the princelings and first families of Central Asia.