ANTI CORRUTION

Fears that ‘dirty money’ paid for Uzbek dictator’s daughter’s £17m Mayfair and Belgravia homes

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The boyfriend of a cor­rupt Uzbek pop singer, socialite and for­mer UN ambas­sador bought lux­u­ry prop­er­ties in London worth more than £17 mil­lion using shell com­pa­nies, The Telegraph can dis­close, rais­ing fears about mon­ey laun­der­ing.

Rustam Madumarov, who was in a long-stand­ing rela­tion­ship with Gulnara Karimova — the daugh­ter of the for­mer Uzbek dic­ta­tor Islam Karimov — pur­chased four homes in Mayfair and Belgravia using a net­work of off­shore accounts.

The prop­er­ties — one of which was lat­er sold for a £1 mil­lion prof­it — were acquired by two com­pa­nies reg­is­tered in the British Virgin Islands (BVI).

Questions have been raised about the pos­si­ble source of the funds used to pur­chase the prop­er­ties, which are thought to be owned for the ben­e­fit of the woman US diplo­mats once dubbed the “sin­gle most hat­ed per­son in Uzbekistan”.

In a memo dat­ed 13 September, 2005, US Ambassador Jon R Purnell accused Karimova of using her gov­ern­ment con­nec­tions to “usurp” and “crush” busi­ness com­peti­tors to sat­is­fy her greed, and con­clud­ed: “The gen­er­al pub­lic view her as some­thing of a rob­ber baron”.

Both Madumarov, who was sen­tenced to six years behind bars in 2014, and his girl­friend have been described as mem­bers of an “organ­ised crime net­work” by pros­e­cu­tors in their home coun­try.

Karimova attends an event at the Youth Art Palace, Tashkent, Uzbekistan, in 2012 CREDIT: YVES FORESTIER/GETTY IMAGES

Authorities in sev­er­al coun­tries are inves­ti­gat­ing assets linked to Karimova, who is the focus of an $800 mil­lion (£600 mil­lion) bribery inves­ti­ga­tion into pay­ments made by three European telecom­mu­ni­ca­tions com­pa­nies in exchange for access to local mar­kets between 2004 and 2013.

Prosecutors in the United States ordered Swiss bank accounts linked to two com­pa­nies thought to be con­trolled by Karimova and hold­ing £200 mil­lion to be frozen in 2016.

It fol­lowed action by the United States District Attorney the pre­vi­ous year to seize cash and prop­er­ty held in Belgium through a num­ber of shell com­pa­nies.

She mixed with celebri­ties such as a Elton John, actress Sharon Stone and mod­el Claudia Schiffer, attend­ed exclu­sive events across Europe, and sought to cul­ti­vate her image as a major phil­an­thropist.

She was briefly tout­ed as a pos­si­ble suc­ces­sor to her noto­ri­ous­ly bru­tal father, whose use of tor­ture to stymie oppo­si­tion was described as “sys­tem­at­ic” in a UN report, despite fierce dis­ap­proval in her home­land.

Following an appar­ent fall-out in 2013, Karimova was stripped of her diplo­mat­ic posi­tions, charged with offences relat­ing to cor­rup­tion, tax eva­sion and mon­ey-laun­der­ing, and placed under house arrest with her daugh­ter in the cap­i­tal, Tashkent.

Speculation Karimova had been poi­soned only came to an end in August this year, after it emerged she had been ques­tioned by Swiss pros­e­cu­tors while serv­ing a five-year sen­tence.

However the inde­pen­dence of the Uzbek inves­ti­ga­tion can be ques­tioned because of fears over polit­i­cal inter­fer­ence.

The Telegraph can for the first time reveal the loca­tion of London prop­er­ties owned by com­pa­nies believed to be con­trolled by Karimova’s clos­est con­fi­dante.

The for­mer British ambas­sador to Uzbekistan, Craig Murray, was high­ly crit­i­cal of the abus­es car­ried out by the Karimov regime CREDIT: AP

Handwritten notes leaked to reporters in Sweden in 2012, and which the Sunday Telegraph has seen, were com­pared by experts with known exam­ples of Karimova’s hand­writ­ing.

One — a spe­cial­ist in Cyrillic script — con­clud­ing with 75pc cer­tain­ty that she was the author of a key doc­u­ment that appears to show the loca­tion and own­er­ship of prop­er­ties around the world.

The same paper indi­cates that some­one with the ini­tials “RM” is the founder and account man­ag­er for four com­pa­nies of which Karimova is the ben­e­fi­cial own­er.

RM” is believed to be Rustam Madumarov, while two of the firms – Oregon and Porchester – have owned three prop­er­ties in the cap­i­tal.

In December 2010, Oregon, which is reg­is­tered in the BVI, pur­chased the lease on a top-floor flat in London for £12.338 mil­lion.

The same day, the com­pa­ny took over the lease for a base­ment apart­ment in the build­ing near Harrods for £1.112 mil­lion.

In February 2012, Porchester, which is also reg­is­tered in the BVI, bought a flat in Mayfair, close to Hyde Park, for £3.68 mil­lion.

The top floor flat was sold through high-end estate agents for £13.25 mil­lion April 2013, net­ting a prof­it of £912,000 for Oregon.

Rubis, the third com­pa­ny referred to in the note as being con­trolled by Madumarov, is record­ed as own­ing a chateau near Paris.

Karimova attends an event at the Youth Art Palace, Tashkent, Uzbekistan, in 2012 CREDIT: YVES FORESTIER/GETTY IMAGES

Madumarov’s name and sig­na­ture appear on offi­cial doc­u­ments regard­ing the pur­chase of this build­ing, the Chateau de Groussay.

A fourth com­pa­ny — also con­trolled by “RM” — is giv­en as the own­er of an apart­ment in Hong Kong via the Expoline shell com­pa­ny.

Madumarov is giv­en as the sole own­er of a com­pa­ny called Expoline which owns a prop­er­ty seized by Hong Kong author­i­ties in con­nec­tion with inves­ti­ga­tions into Karimova, mak­ing it high­ly prob­a­ble he is the “RM” referred to as con­trol­ling Oregon and Porchester.

Two of the London prop­er­ties are still owned by Oregon and Porchester, Land Registry records show.

At the time when both the pur­chas­es and sale were made, third par­ties involved in the deals were required to car­ry out addi­tion­al due dili­gence on so-called ‘polit­i­cal­ly exposed per­sons’, includ­ing rel­a­tives of heads of state, tak­en on as clients.

Karimova, who also had a career as a fash­ion design­er, is fet­ed at the Mercedes-Benz Fashion Week Russia, Moscow, in 2012. CREDIT: PASCAL LE SEGRETAIN/GETTY IMAGES

Additional guid­ance was pub­lished in June 2017, but the gov­ern­ment has to make good on its promise to cre­ate com­pre­hen­sive reg­is­ter of shell com­pa­nies’ real own­ers.

Madumarov is named along­side Karimova in asset recov­ery papers filed in New York per­tain­ing to three fur­ther shell firms and sev­er­al hedge funds.

He appears as a direc­tor of with numer­ous shell com­pa­nies iden­ti­fied in the so-called Panama Papers leak orig­i­nat­ing with law firm Mossack Fonseca, some of which have con­nec­tions to com­pa­nies reg­is­tered in the UK.

Eleanor Nichol, Deputy Director of Corruption Campaigns at Global Witness, said: “The gov­ern­ment com­mit­ted to crack down on dirty mon­ey in the prop­er­ty mar­ket over two years ago, but has so far failed to intro­duce any leg­is­la­tion, despite wide­spread sup­port.

It must hold firm and not let the pol­i­tics of Brexit get in the way.”

Russian pres­i­dent Vladimir Putin called Islam Karimov’s death in September 2016 “a great loss”. CREDIT:MIKHAIL METZEL/REUTERS

The dis­clo­sure comes as peers sep­a­rate­ly call on min­is­ters to hon­our a pledge to pub­lish a pub­lic reg­is­ter list­ing indi­vid­u­als who own UK prop­er­ties through com­pa­nies reg­is­tered over­seas — a move the Government had said would “assist inves­ti­ga­tors [to] track down and recov­er pro­ceeds of crime”.

Lord Faulks, a QC, has put down an amend­ment to the Sanctions and Anti-Money Laundering Bill, which would intro­duce a reg­is­ter of ben­e­fi­cial own­er­ship of UK prop­er­ties.

Currently, indi­vid­u­als who ulti­mate­ly own prop­er­ty in Britain can remain anony­mous by pur­chas­ing the homes through an off­shore com­pa­ny and sim­ply list­ing that enti­ty in offi­cial land reg­istry records. The amend­ment, which has attract­ed cross-par­ty sup­port, is expect­ed to be debat­ed on Wednesday.

It is vital that we our­selves retain our rep­u­ta­tion and allow­ing bil­lions of pounds of prop­er­ty to be owned by murky for­eign com­pa­nies is a blot on that rep­u­ta­tion,” Lord Faulks said, with­out ref­er­ence to any spe­cif­ic cas­es.

It seems absolute­ly with­in the scope of the Bill, con­sis­tent with Government pol­i­cy and frankly a mat­ter of urgency. If not now, when?”

Written by Luke Heighton, Edward Malnick

Fears that ‘dirty mon­ey’ paid for Uzbek dictator’s daughter’s £17m Mayfair and Belgravia homes

 

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