Norway’s partially state-owned telecommunications giant Telenor has become the latest Norwegian company to attract the interest of corruption investigators. Newspaper Dagens Næringsliv (DN) reported on Thursday how officials from Norway’s white-collar crime unit Økokrim paid a visit to Telenor’s headquarters at Fornebu just west of Oslo this week, in connection with an international investigation of mobile phone firm VimpelCom Ltd, in which Telenor has a significant stake.
Telenor, which itself remains partially owned by the Norwegian government, has a long and turbulent history of involvement with VimpelCom and its Russian oligarch co-owner, Mikhail Fridman. After years of legal battles over control, Telenor now owns 35.7 percent of VimpelCom’s shares and has 43 percent of its voting rights. Telenor Chief Executive Jon Fredrik Baksaas sits on VimpelCom’s board and VimpelCom, now based in Amsterdam as a result of earlier legal settlements to power struggles over the company, is run by a Norwegian chief executive, Jo Lunder, a former chief operating officer of Telenor Mobile who also has served as VimpelCom’s chairman. Another Norwegian and Telenor veteran, Jan Edvard Thygesen, serves as VimpelCom’s deputy CEO and chief operating officer.
Now VimpelCom is the target of an international investigation involving authorities in Switzerland, the Netherlands and the US. The Swiss, Dutch and American investigators called in their Norwegian counterparts, who, along with Telenor, confirmed the visit to Telenor’s headquarters on Tuesday. “The corruption team in Økokrim is supporting Swiss and Dutch authorities in connection with an investigation directed at among others VimpelCom,” Økokrim’s lead attorney Marianne Djupesland on its corruption team told Dagens Næringsliv (DN) on Thursday.
VimpelCom itself reported on Wednesday that it also has received a letter from regulators at the US Securities and Exchange Commission (SEC) who are asking for documents related to their own investigation into possible corruption. VimpelCom reported that “representatives of the Dutch authorities including the Dutch public prosecutor office” also had “visited” their offices in Amsterdam and that “the investigations appear to be concerned with the company’s operations in Uzbekistan.” Telenor officials have referred most inquiries about the investigation to VimpelCom and Telenor’s CEO Baksaas has declined to comment.
The corruption suspicions involve the operations of VimpelCom and other telecommunications companies in Uzbekistan, a former Soviet republic run by a president, Islam Karimov, who’s widely considered to be a dictator. DN noted that Uzbekistan has been referred to as “a nightmare of corruption, organized crime, forced labour and torture” in US diplomatic cables released by Wikileaks. DN published a long series of articles in 2012 detailing Telenor’s involvement in Uzbekistan through its VimpelCom stake, highlighting how Telenor already then was subject to scrutiny and criticism for doing business with dictators.
VimpelCom and TeliaSonera of Sweden are among telecoms firms that bought their licenses to conduct mobile phone business in Uzbekistan from a Gibraltar-registerd firm called Takilant Ltd. It’s been linked to Karimov’s controversial daughter Gulnara Karimova, who now is under investigation by Swiss authorities for alleged money laundering according to reports in both DN and The Guardian. She reportedly left her luxurious home on the shore of Lake Geneva last fall and it was ransacked by Swiss police. Several media reports have since claimed she is under house arrest back home in Uzbekistan, that TV stations she controlled there have gone off the air and that fashionable shops she ran have been closed on charges of tax fraud. That raises questions of whether her powerful father is distancing himself from her, while the international investigation is believed to be probing whether she received bribes through the mobile licensing company Takilant that both TeliaSonera and Telenor used to obtain licenses.
‘Not the same situation’
TeliaSonera’s top management and several board members ended up resigning after an investigation into their operations revealed they had little if any control over who they were dealing with. The payments to Takilant are suspected of involving bribes and charges are pending following conclusion of the probe by Swedish police into TeliaSonera’s operations in Uzbekistan.
Telenor officials insisted to DN on Thursday that VimpelCom isn’t in the “same situation” as TeliaSonera, without explaining in detail how VimpelCom’s payments to Takilant differed from TeliaSonera’s. Telenor spokesman Glen Mandelid, like Baksaas, is quick to stress that Telenor is merely a “minority shareholder” in VimpelCom, but nonetheless took up concerns over the Uzebekistan operations with VimpelCom and received assurances that “all transactions were checked out with American anti-corruption decisions.”
Asked by DN whether that means Telenor has received privileged information, whether Telenor accepted it and whether it came from Telenor’s former executive Jo Lunder, who now is responsible for VimpelCom’s operations, Mandelid of Telenor told DN: “We have received a response that this was in line with regulations. I don’t have the details.” Mandelid added that Telenor has urged VimpelCom to be more open about its business dealings in Uzbekistan.
Lunder, like Baksaas, however, refused to answer questions about the investigation. A spokesman for Lunder in Amsterdam, Bobby Leach, told DN that “we will cooperate fully with the authorities in the investigation, which we expect will take time to conduct.”
Leach added, though, that it was “logical” to assume that the investigation involves VimpelCom’s dealings with Talikant. He said he would not compare VimpelCom’s dealings, though, with those of TeliaSonera. He would not comment on Gulnara Karimkova’s connections with Takilant.
He conceded that the investigation is “serious” for VimpelCom. Meanwhile, the leader of the Norwegian arm of the investigation being carried out by Økokrim in Oslo, Marianne Djupesland, stressed that Telenor currently has the status of “witness” in the probe. She wouldn’t say who Økokrim’s corruption team spoke with at Telenor this week, or whether they asked for documents or are calling in any Telenor executives for questioning. DN noted that VimpelCom provided around NOK 5 billion (USD 833 million) to Telenor’s coffers last year alone.