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Telecommunication company TeliaSonera may exit operations in Azerbaijan because of a number of corrupt deals, according to a report by Muddy Waters Research Group.

TeliaSonera is accused of corrupt deals with some Azerbaijani officials. According to Bloomberg, TeliaSonera AB shares fell the most in more than three years after Muddy Waters LLC published a report questioning the extent of the Swedish phone company’s transparency about its Eurasian businesses.

Carson Block, the Muddy Waters founder, said they have a list of payments – total about $2 billion – that were made in numerous countries that in many ways make no commercial sense. “We think there is a good chance these are corrupt payments.” TeliaSonera said it could not identify with the criticism.

According to the report, Azerbaijan is one of TeliaSonera’s top performing Eurasian assets. Muddy Waters’ tally of payments Telia made to suspect counterparties in Azerbaijan in often commercially questionable transactions is SEK 9.1 billion (US$1.1 billion).
“Yet the same time, Ms. Khadija Ismayilova, an Azerbaijani investigative journalist, has been rotting in a prison in Azerbaijan,” the report says. Ms. Ismayilova reported that TeliaSonera’s joint venture partner in Azerbaijan is closely linked to the ruling clan, and that TeliaSonera knowingly assisted them in corruptly transferring one of the state’s most valuable assets – its holding in Azercell – to themselves, Muddy Waters said.

According to findings documented by the journalists from The Organized Crime and Corruption Reporting Project (OCCRP), taxpayers in Azerbaijan lost more than US$ 600 million in a deal that made no sense for all involved except for a murky offshore deeply connected to President Ilham Aliyev. A company close to Azerbaijani President Ilham Aliyev and his clan likely walked off with more than US$ 1 billion in a takeover of his country’s stake in Azercell Telecom, the largest mobile operator in the country. The process was aided by a subsidiary of TeliaSonera, the Swedish-Finnish telecom giant, which acted against its own interest to allow the deal to happen. The arrested Azerbaijani journalist Khadija Ismayilova said that the revelations of massive bribes in the Azerbaijani telecoms industry explain why she is in jail today.

Related:
Details of TeliaSonera offshore scandal revealed: Aliyev clan stole US$ 600 million from Azerbaijanis 
Azerbaijani journalist Khadija Ismayilova: Exposing TeliaSonera’s scandalous bribery is reason for my arrest