Telia deferred prosecution agreement and Coscom guilty plea over Uzbekistan bribery (2017)

The DOJ resolution

DOJ said Telia Company AB, a Stockholm telecommunications company and former issuer of US securities, entered a deferred prosecution agreement in connection with a criminal information charging conspiracy to violate the FCPA anti-bribery provisions ¹. Coscom LLC, Telia's Uzbek subsidiary, pleaded guilty to a one-count information on the same charge and was sentenced by the court ¹.

DOJ said Telia agreed to pay a US criminal penalty of US$274,603,972, which includes a US$500,000 criminal fine and US$40 million in criminal forfeiture paid on behalf of Coscom ^1,2. Telia agreed to put in place internal controls and to cooperate with the continuing investigation ¹.

DOJ said the companies did not voluntarily self-disclose ¹. It said they received a 25 percent reduction off the bottom of the Sentencing Guidelines fine range for cooperation and remediation ¹. DOJ said the lack of self-disclosure was the reason they did not receive more credit ¹. The DOJ and SDNY releases do not state the DPA term or name a monitor ^1,2. This page has not confirmed how the DPA ended.

Conduct described by DOJ

DOJ said that, according to the companies' admissions, Telia and Coscom paid about US$331 million in bribes to an Uzbek government official ¹. DOJ described the official as a close relative of a high-ranking government official who had influence over the Uzbek body that regulated telecommunications ¹.

DOJ said the payments were made on several occasions from about 2007 to 2010, including through a shell company that certain Telia and Coscom managers knew was beneficially owned by the official ¹. DOJ said the bribes helped Telia enter the Uzbek market and helped Coscom gain telecom assets and keep operating ¹. Prosecutors said the payments were wired through bank accounts in New York City ¹.

DOJ said that in late 2012, after Swedish media reports, a Swedish criminal investigation and an internal Telia investigation had begun, certain managers considered an additional bribe ¹.

Acting U.S. Attorney Joon H. Kim said the companies "have admitted to paying, over many years, more than $331 million in bribes" ^1,2. The SDNY release says Telia's admission is set out in "the statement of facts set forth in the DPA" ².

SEC and foreign resolutions

The SEC said on 21 September 2017 that Telia would pay US$457 million in disgorgement and that portions of the US amounts could be offset by payments overseas ³. The DOJ releases give the SEC figure as US$457,169,977 in disgorgement and prejudgment interest ^1,2. The SEC release describes the DOJ criminal fine as "more than $508 million" ³. DOJ gives total criminal penalties of US$548,603,972, including the US$40 million forfeiture ¹. The SEC release does not say whether Telia admitted or denied the SEC findings ³.

DOJ said Telia agreed to pay a US$274 million criminal penalty to the Public Prosecution Service of the Netherlands, which DOJ credited ¹. DOJ said the SEC would credit disgorgement paid to the Swedish Prosecution Authority or the Dutch authority, up to half of the SEC total ¹. This page does not cite the Dutch or Swedish decisions themselves.

Forfeiture actions

SDNY said the United States had filed civil complaints seeking forfeiture of more than US$850 million held in bank accounts in Switzerland, Belgium, Luxembourg and Ireland ². SDNY said the funds are alleged to be bribe payments by VimpelCom, Telia and a third telecom company, or funds involved in laundering them ². These are allegations in civil complaints. This page has not confirmed their outcome.