Kyrgyzstan: Anatomy of an Unconvincing Scandal

A writer named Kate Cohen, posting on a little-known website, recently uncovered shady business practices that subsequently created a riptide of political scandal in Kyrgyzstan.

There are a couple of problems with the story, however. For one, Kate Cohen may not be a real person. And central elements of the scandal may have been fabricated, as there evidently was not a rigorous review process in place to check the facts prior to publication.

All the same, the government is running with the story, which happens to blacken the names of some of its most prominent critics at an important juncture in Kyrgyz politics.

The piece in question was published on October 12 by Cohen on a website called Litterareport.com. It alleged that three members of parliament with the opposition Ata-Meken party connived to profit from the sale of a telecoms company. Kyrgyz authorities say the company was expropriated by the son of former President Kurmanbek Bakiyev, who was ousted in 2010.

It just happens that the three opposition politicians identified in the article - Omurbek Tekebayev and fellow Ata-Meken MPs, former General Prosecutor Aida Salyanova and ex-Justice Minister Almambet Shykmamatov - are among the staunchest opponents of planned changes to the constitution that political commentators say would consolidate the powers of the current ruling elite in Kyrgyzstan. The changes, which would enhance the powers of the prime minister's office at the expense of parliamentary authority, are to be put to a nationwide referendum on December 11.

Some observers suspect that President Almazbek Atambayev, who is limited constitutionally to one presidential term ending in 2017, wants to use the referendum to lay the groundwork for his immediate entourage to retain a dominant grip on power. Opponents allege that the government is trying to secure its desired result via mass-media manipulation and other forms of misuse of power.

The Litterareport.com report might have gone unnoticed had it not been picked up by government-friendly newspaper Vecherny Bishkek. Normally, a newspaper picking up an item from a small, foreign online outlet might not elicit much suspicion, but for one peculiar fact: Vecherny Bishkek's article appeared on October 5, one full week before Cohen's piece was even published.

The scandal has snowballed from there.

At the heart of this saga is a mobile telecommunications company that has been through many hands at multiple stages. The Megacom brand was created in 2006 and was originally owned by a holding company called BiMoCom, whose owners claim to have been driven to insolvency in 2009 as a result of the machinations of Maxim Bakiyev, the son of the former president. Maxim Bakiyev and his associates are alleged to have later simply taken over the whole company lock, stock and barrel.

After Maxim Bakiyev's father was deposed in a bloody uprising, the newly installed government confiscated a 49 percent stake in the telecommunications company, then ostensibly in the ownership of an entity called Alfa Telecom. That still left another 51 percent stake up in the air, controlled, according to Kyrgyz government officials, by individuals close to Bakiyev and held by Belize-registered Southfield Management Inc.

The Litterareport.com article alleges that as of April 2012, the three Ata-Meken MPs, Tekebayev, Salyanova and Shykmamatov, became minority shareholders in Southfield Management. By way of evidence, the article indicates that documents supporting that allegation could be found either as part of the Panama Papers leak, or via a similar initiative. Yet a review by EurasiaNet found that the companies and individuals mentioned in the Cohen article do not appear in the Panama Papers database. The Litterareport.com article does allude to what is describes as a "compliance-focused database," but provides no name or link.

The owner of Litterareport.com, an IT consultant based in Boston, Massachusetts, named Bryan Healey, said he had no interaction with the writer of the article and that the unsolicited piece was directly uploaded without his editorial involvement. Emails from EurasiaNet.org to the address provided for Kate Cohen received no response.

While Cohen does not name any compliance-focused databases, some Kyrgyz media - including Vecherny Bishkek - have cited an entity called the Justice Information Network, which casts itself as an analogue to the Panama Papers. The would-be network describes its membership as being "limited to organizations which are subject to anti-money laundering regulation (including self-regulation) under their domestic law, and to law enforcement bodies and agencies."

The Justice Information Network website claims, albeit with no supporting documentation, that Tekebayev owned an 8 percent stake in Southfield Management, and that Salyanova and Shykmamatov held 7 percent each. The website additionally claims that it obtained this information as the result of a leak in 2015 from an entity called Unitrust, but does not specify what this is.

The Justice Information Network only appears to feature in-depth information about Kyrgyzstan. Other data, such as lists of wanted criminal suspects in neighboring Kazakhstan, are freely available elsewhere from official websites.

Emails sent by EurasiaNet.org to an address provided on the Justice Information Network website seeking clarification received no response.

Vecherny Bishkek's story on the Litterareport.com article was in turn picked up by Kyrgyzstan's state broadcaster, KTRK, which based an entire nine-minute report on the newspaper's story. Around half the report was a scrolling image of the text of a Vecherny Bishkek piece, which was reproduced without qualification.

"A sensational article about the minority shareholders of Bakiyev's company can be found online on the Vecherny Bishkek website. The newspaper's journalist cites international media, which tell the story of secret offshore operations and [draws on information in the] Panama Papers," a voiceover reads in the opening of the report, alluding to Litterareport.com and (incorrectly) identifying Panama Papers as the source of the information.

The allegations gained further momentum in mid-November, when Abdil Segizbayev, head of the State Committee for National Security, or GKNB, claimed to have received documents from the authorities in Belize confirming the same details. By way of evidence, pictures were posted on the presidential website showing Segizbayev handing notarized documents to President Atambayev. Segizbayev suggested that the plan was to sell Southfield Management's shares in Alfa Telecom for "more than $50 million." The Ata-Meken MPs would under this scheme have purportedly expedited the sale of the shares by using their former status as members of the government coalition, further enriching Bakiyev and earning large amounts for themselves in the process.

This episode is odd on several counts, however. Seasoned corruption investigators have told EurasiaNet.org they believe it is implausible that the government of Belize would have such information about the beneficiaries of off-shores registered on its territory. And it would be unprecedented for the government of Belize to voluntarily, and for no evident reason, hand over such data to a foreign government, they add.

Other factors call Segizbayev's claims into question. One is the fact that the notarized document featuring Tekebayev's name provided the number of his national Kyrgyz ID card, which is valid only for in-country operations, but is useless for international financial transactions.

The Belize-based law firm that notarized the documents produced by Segizbayev, Wrobel & Co, did not respond to repeated email requests for clarification on its role in verifying alleged shareholder information. A representative for the law firm told RFE/RL's Kyrgyz service that it did not send the Kyrgyz government the notarized documents.

Following Segizbayev's alleged revelations, several members of parliament demanded the creation of a special commission to investigate those and other claims published in local media. As yet, no formal criminal investigation has been initiated over the case, and critics of the way the entire affair has been handled argue that there is no basis for any such action.

"From a legal point of view, investigating this case would have no prospects," Cholpon Dzhakupova, a member of parliament with Bir Bol party, told parliament. "This entire campaign was carried out just to slander political opponents [of the administration]."

The telecommunications scandal is held up as a clear example of how the government is using media as a weapon against its enemies. Some MPs, for example, criticized the role of the state broadcaster, KTRK, in helping perpetuate a furor concocted with tenuous evidence.

"Vecherny Bishkek wrote an article about the involvement of deputies in the scandal surrounding Alfa Telecom, and that same evening KTRK ran the story. This is a plot. This was all agreed upon beforehand," MP Janar Akayev, a former reporter and presidential spokesman, told parliament.