THE ORIMA DEFENSE TEAM SPEAKS; BUT WHAT ARE THEY

UNCLAS SECTION 01 OF 02 DUSHANBE 000515 SIPDIS SENSITIVE SIPDIS DEPT FOR SCA/CEN E.O. 12958: N/A TAGS: PGOV PHUM EINV ECON TI SUBJECT: THE ORIMA DEFENSE TEAM SPEAKS; BUT WHAT ARE THEY SAYING? REF: DUSHANBE 512 ¶1. (SBU) Summary: Post reported in reftel on the April 8 conviction of local entrepreneur Marouf Orifov, majority owner of the ORIMA chain of supermarkets, for bribery and tax evasion. Orifov's defense team corroborated the generally held view that the trial lacked basic elements of fairness. While we were unable to clarify exactly how Orifov fell out of favor with the authorities, we stand by our initial determination that this verdict is a strong signal that investors should stay away from Tajikistan. End summary. ¶2. (SBU) On April 10, Emboffs met with Marouf Orifov's son, Alisher, his accountant, Gulnora Makhmudova, and two of his defense lawyers, Inoyat Agliev and Shavkat Kosimov. We discussed court proceedings, the financial health of the company, and the reasons why Orifov was singled out for prosecution. Justice, Tajikistan Style -------------- ¶3. (SBU) The lawyers walked us through the legal issues in the case. We asked why the Supreme Court was the court of first instance. The lawyers said that they could not find a legal basis for why a lower court did not try the case, and Iglaev added "no one here questions the Supreme Court if it asserts its jurisdiction over a case." We asked why the State Committee on National Security began investigating Orifov in 2007. The lawyers described how an Orima customer allegedly complained about the quality of a product she purchased, which led to a State Committee inspection of one of Orima's warehouses. Eventually, the head of the State Committee's Department for Economic Intelligence, Colonel Salimov, setting up a lunch meeting for August 7, 2007, and Orifov was arrested for attempted bribery at the restaurant during the meeting. The lawyers said the court disregarded their arguments that the State Committee never had a statutory basis to begin investigating Orifov in the first place. ¶4. (SBU) The lawyers described how the court convicted Orifov of bribery despite the lack of any evidence directly implicating him. Colonel Salimov was the only State Committee official to testify during the trial, and he did not present any official reports or documents. The court viewed a video surveillance tape of the lunch meeting, but there was no indication that Orifov offered a cash bribe. 
The court heard the testimony of two witnesses who were at the restaurant where the alleged bribe took place; from the video, they were not in a position to actually witness the alleged criminal act. There was no forensic evidence (including fingerprints) linking Orifov to the $10,000 that he allegedly handed to Salimov. ¶5. (SBU) Alisher Orifov walked us through the tax evasion charge. He recounted the complicated tax provisions with which Orima had to comply, and he produced numerous documents showing that Orima had attempted to clarify its tax obligations with the Tajik tax authorities from 1997 to 2007. He said that the court ignored this evidence, finding his father guilty of avoiding taxes for 10 years. He pointed out that the court's findings on these charges contradicted the positions that the Ministry of Justice and the Committee on Taxation had taken. Big Bucks, Whammies -------------- ¶6. (SBU) Makhmudova's description of Orima's financial situation is similar to that described in reftel. Orifov owns 70% of the business, and a Dutch investor owns 30% (Orifov will have to forfeit his ownership interest pursuant Q(Orifov will have to forfeit his ownership interest pursuant to the court verdict). The company had received a $400,000 loan from the International Finance Corporation in 1999, and paid it off in full within 5 years. The company had secured a $4.6 million loan from the European Bank for Reconstruction and Development which was to be delivered in four tranches, and the company has received 2 tranches thus far. The company has passed all international audits required under the terms of their loan agreements. The remainder of their most recent loan appears to be on hold. ¶7. (SBU) Makhmudova said that the company used the loans to build stores and a state of the art warehouse. Orifov's DUSHANBE 00000515 002 OF 002 arrest has disrupted the company's business plan and severely challenged its ability to stay afloat. The Real Story Remains Elusive -------------- ¶8. (SBU) We mentioned different theories about why this case came about (see reftel). Our interlocutors called President Rahmon's daughter, Takhmina, a "friend," and they insisted that Orifov did not have a dispute with her. None of our interlocutors could come up with a coherent reason for why the authorities would bend so many rules to prosecute Orifov. As we were leaving the meeting, Kosimov told the Political Assistant, "I think I know who did this, but I have to be very careful." He never revealed his information to us. ¶9. (SBU) Comment: There is obviously more to this story than the defense team is telling us. The defense team has reason to interpret the facts in this case in Orifov's favor, but even taking this into account, we continue to view this case as a selective, nepotism-based prosecution. On one level, the case shows the extreme deficiencies in the Tajik criminal justice system, including the extreme deference the courts give the State Committee on National Security. On another level, the case shows the Tajik authorities' hostility toward entrepreneurship, and should be used whenever discussing Tajikistan's continued requests for financial assistance and investment. End comment. JACOBSON