Regulator downplays Swedish bribery connection

Latvia's financial sector regulator the Financial and Capital Markets Commission (FKTK) has said it is satisfied that no rules were broken by a Latvian bank in connection with a large-scale bribery investigation being led by Swedish police.

A report by financial newswire Bloomberg on Thursday said the regulator was satisfied that no rules were broken during the transfer of funds from Swedish telecoms giant TeliaSonera to an account held at Parex bank, the private bank that went spectacularly bust in 2008, forcing a massive government bailout.

Swedish authorities are investigating claims the payments totaling more than €64 million were made via Parex in connection with a lucrative mobile phone contract inside authoritarian Uzbekistan.

Investigators believe the money may have been channeled to businesses controlled by the family of Uzbekistan's President Islam Karimov, who has ruled the central Asian republic as virtual dictator since 1991.

Parex was “fulfilling the requirements” at the time it received the funds in 2007-08, FKTK chief Kristaps Zakulis told Bloomberg.

The investigation into the shady deal has already led to the resignation of TeliaSonera’s Chief Executive Officer Lars Nyberg and other senior employees.

Dutch investigators are also investigating the allegations which touch on other telecoms companies.

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