Tag Archives: Gulnara Karimova

Belgian and Uzbek Governments Profit from Termination of DoJ’s Kleptocracy Unit

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Central Asia Due Diligence and the Uzbek Forum for Human Rights have identified the latest fallout from the Trump Administration’s destruction of American institutions devoted to fighting global corruption. The governments of Belgium and Uzbekistan have each pocketed $108 million in stolen assets that should have gone to the people of Uzbekistan.

In this just released paper, the two human rights NGOs explain how the demise of the Department of Justice’s Kleptocracy Asset Recovery Initiative allowed the two governments to ignore provisions in the UN Convention Against Corruption and the principles of the Global Forum on Asset Recovery that together bar assets stolen by a corrupt official from being kept by the government of the country where the official stashed them or returned to the official’s corrupt cronies.

Lawyers for the Initiative had designed a sophisticated process (details here) to see the $216 million in bribes to former Uzbek first daughter Gulnara Karimova found in Belgian banks DoJ would go to the UN trust fund overseeing development programs in Uzbekistan. With the Initiative’s demise, the Belgian and Uzbek governments apparently saw no reason they should not divvy up the money between them.

So thanks to the Trump Administration, Belgium, one of the world’s wealthiest countries, is now $108 million wealthier, and Uzbek’s leaders, several Gulnara’s accomplices, now have $108 million to spend keeping themselves in power. Meanwhile, the citizens of Uzbekistan, GDP per capita $3,500, scrape by.

An Assessment of the Swiss Return of Stolen Assets to Uzbekistan

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The return of assets stolen by corrupt means is “a fundamental principle” of the United Nations Convention Against Corruption, and the Convention mandates that its now 191 state parties “afford one another the widest measure of cooperation and assistance” to ensure states victimized by corruption recover the proceeds of the crime wherever they are located (article 51).

Easy enough to state the principle. And easy enough to implement where the victim state’s leaders are democratically chosen, committed to advancing citizens’ well-being, and corruption is under control. But what if those conditions don’t hold? What if the same kleptocrats who stole the assets are still in power? Even if the crooks have been purged, so long as autocrats run the government, what guarantee is there that the assets won’t simply enrich the current powerholders? Or worse yet, fund measure to further repress their citizens?

As my friend and former Soros Foundation colleague Alisher Ilkhamov describes in the current issue of Central Asian Due Diligence (here), Switzerland is working through these issues as it begins to return to Uzbekistan the several hundred million dollars the former president’s daughter Gulnara Karimova stole. Uzbekistan’s government is a step above where it was when Gulnara set the record for shaking down foreign investors, but a budding democracy it is not. By a long shot.

Alisher describes the conditions Switzerland attached to the return of a first tranche of $131 million in 2022, how they were implemented, and how that experience should inform the recent agreement between Switzerland and Uzbekistan to return another $182 million. His assessment will be of value to policymakers everywhere wrestling with the return of stolen assets to states that fall far short of democratic, good governance norms.

Should a Kleptocrat Be Able to Bribe Her Way Out of Trouble?

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Gulnara Karimova parlayed her position as daughter of Uzbekistan’s first post-Soviet ruler into an international symbol of kleptocracy.  Reviled at home and abroad for vulgar excess, after her father’s death she was sentenced to a long prison term following a sham trial.  But most of the billion or so dollars she stole remains beyond the Uzbek government’s reach, tied up in complex litigation principally in Switzerland.

Now, as she recently revealed, she is in negotiations to hand back most of what she stole – in return for her release from one of Uzbekistan’s notorious prison colonies and the right to hang onto to perhaps as much as a hundred million for herself and the lawyers and fixers negotiating the deal. Uzbek citizens and activists are in arms over this blatant attempt by a posterchild for kleptocracy to bribe her way out of prison.  In an open letter, civil society activists call on the Swiss government, which would have to accede to this unseemly bargain, to repudiate it. They ask too that other government with claims over some of the assets, and thus possibly some say over the deal, to help kill it.

Allowing a kleptocrat to bribe her way out of jail sets a terrible precedent. Is it one the international community wants to see set?  Do Swiss citizens really want their government to be the one setting it? Why is the Swiss government in such a hurry to return dirty money to the Uzbek government?  Particularly in the face of opposition from representatives of the real victims of Karimova’s crimes, the citizens of Uzbekistan.

In their letter, the activists outline an alternative to a hasty return, one that would see Karimova held accountable in a real trial for her crimes and the stolen assets returned in ways that would advance the welfare of all Uzbeks. The English version of the letter here, the Russian one here, and the French one here.