Dutch authorities opened an investigation in 2015 into TS Dutch holding company for allegedly paying bribes in Uzbekistan. The US Department of Justice and Securities and Exchange Commission also investigated claims of bribery related to transactions in Uzbekistan and Azerbaijan. Vimpelcom ultimately paid $795 million in penalties to US and Dutch authorities for violations of the Foreign Corrupt Practices Act. A report also found weaknesses in Telenor's oversight of its ownership in Vimpelcom, though no Telenor employees were directly involved in corrupt actions. Telenor's CEO and general counsel resigned in relation to the matter.

1. IS THERE COMPLIANCE BEYOND THE CRISIS ?

2. 2016-05-192
THE POWER OF …

4. Dutch authorities opened investigation into TS Dutch holding company on
April 2015 for allegedly paying bribes to Uzbekistan authorities
Investigation by the U.S. Department of Justice and U.S. Securities and
Exchange Commission of kleptocracy / bribery in Uzbekistan
Investigation by Swiss authorities in 2012 into claims of bribery related to
TeliaSonera and VimpelCom.
Alleged payments of bribes related to transactions in Uzbekistan and
Azerbaijan

5. DoJ SEC OM
$230.2 Million
Criminal Penalty
$167.5 Million Payment
Disgorgement of the ill-gotten gains
$397.5 Million Criminal Penalty and
Disgorgement
U.S.: $397.7 Million Dutch: $397.7 Million
Total Vimpelcom Payments: $795.3 Million
Forfeiture 850 musd – bank accounts belonging to Takilant (and Vimpelcom 40 musd)
• Deferred Prosecution Agreement, ”DPA” - a three year ”probation” period with an appointed monitor who will oversee the implementation of an effective
compliance program
• The Vimpelcom US part (leaving the Dutch part out) is the 6th largest FCPA settlement ever. If the global amount is instead used, it is the largest (beating the
Siemens 2005 settlement).
• Discount for ”substantial” cooperation and ”extensive” remediation and ”prompt ackowledgement of wrongdoing”.
• Payment flows from Takilant through bank accounts at US financial institutions
• Legal opinions – Vimpelcom had procured several legal opinons (”to provide a plausable cover”) on FCPA relevance which indicated that there were no concerns.
Certain facts relevant for the opinion had not been properly disclosed to the lawfirms.
• ”Witness” in executive management repreatedly voiced concerns but was ignored
Deferred Prosecution Agreement Vimpelcom

6. The report states that “no Telenor employees have been involved in corrupt actions. It gives Telenor partial credit for its
handling of the ownership in Vimpelcom, but also points to weaknesses in organizational structure, communication and
leadership in this matter”.
A “central part of the report relates to Telenor’s handling of a serious matter in 2011, from an employee seconded to
VimpelCom. The person raised concerns of potential corruption to executives in Telenor and to Telenor nominated board
members in VimpelCom. This concern, however, was not shared with Telenor’s then CEO, Jon Fredrik Baksaas, until
March 2014 and then to the Telenor Board of Directors in December 2014. The Ministry of Trade, Industry and Fisheries
was informed in October 2015”.
“Telenor has reached an agreement of resignation with CFO, Richard Olav Aa and General
Counsel Pål Wien Espen”. (None of them nominated board members of Vimpelcom).
Deloitte lawfirm has conducted a review of Telenor’s handling of minority ownership in Vimpelcom, 2005 – 2015.
The final report was issued 27th of April 2016.

7. 7

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9. 2016-05-19 Responsible Business9

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11. 11
WHO ARE YOU ?
“In my defence, I tried to raise questions of consultancy
agreements, fees and payments to related parties but the
FIFA executive committee told me I was being rude. In
hindsight I think I probably should have acted more
forcefully.”
Lennart Johansson, former chairman UEFA 2015
What is the role and responsibility of a for-profit company?
Schultz asked partners (employees), shareholders and
customers: “What is the role and responsibility of all of us,
as citizens?”
Viewing the American Dream as a “reservoir” that is replenished with the values, work
ethic and integrity of the American people, Schultz said, “Sadly, our reservoir is running
dry, depleted by cynicism, despair, division, exclusion, fear and indifference.”
He suggested citizens fill the reservoir of the American Dream back up, “not with
cynicism, but with optimism. Not with despair, but with possibility. Not with division, but
with unity. Not with exclusion, but with inclusion. Not with fear, but with compassion.
Not with indifference, but with love.”
“It’s not about the choice we make every four years,”
Schultz said. “This is about the choices we are making
every day.”
Howard Schultz Calls for Civility and Values-Based
Leadership

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