Author: Badalian Vardan

“IRAN SYMPHONY” TO BE PERFORMED

IranMania
Wednesday, October 12, 2005 – ©2005 IranMania.com

LONDON, October 12 (IranMania) – The Iranian composer of “Iran
Symphony”, Shahin Farhat, said that Honar Academy of Culture is
commissioned to perform the “Iran Symphony”.

The symphony represents the national glory, history and folk music,
while old melodies have been included in the piece in a modern way.

He told IRNA that the symphony has been written based on Iranian
themes.

Not making any reference to the expected date the piece will be
played , he said, “Following the successful performance of Persian
Gulf and Damavand symphonies in Armenia, which was hailed warmly,
I decided to repeat the concert on the domestic scene due to its
purely Iranian themes.”

The musician referred to the performance of the symphony in Iran as
a privilege and expressed his constant interest in presenting his
works on the domestic scene.

Farhat also pointed out that one of his musical pieces will be
performed by Ali Rahbari in the near future.

Turning to the difficulties facing the performance of orchestral works
in Iran, he said, “Lack of proper musical instruments and equipment
as well as secondary facilities such as synchronous recording make
the conductor of the orchestra unable to arrange the rhythms.

“Nowhere in the world are classical musical pieces played in such an
order as to start with string instruments, proceed with recording
percussion instruments and eventually mix the resulting tunes,”
concluded Farhat.

–Boundary_(ID_3NcjEYyc8y91NTrbfTxJ9A)–

NO RE-SETTLEMENT IN KARABAKH CARRIED OUT
By Tatoul Hakobian

AZG Armenian Daily #183
12/10/2005

Demographic Situation Disturbing

Azat Artsakh newspaper of Stepanakert published demographic situation
in Nagorno Karabakh for January-September of 2005. In the period of
8 months 1525 children were born in Nagorno Karabakh against the 1619
for the last year. The natality for the given period was 458 people,
67 people or 10.9 percent decrease compared with 2004. Official
figures for newcomers in January-September of 2005 were 677 and 627
for emigrants. The mechanical growth was only 50 people.

The Armenian historiography and press wrote numerous times about
Baku’s partiality in regard to demographic policy. It is already
10 years that Karabakh is out of Baku’s control and logically the
Azerbaijani authorities are not responsible for demographic situation
in the region. Armenia and Nagorno Karabakh are the only ones to hold
responsible today.

According to population census in 1989, the population of Nagorno
Karabakh was 189.085, 145.500 of which were Armenians, 40.700 Azeris
(Baku still claims that the Azeri population of Karabakh amounted
to 46.347) and the rest were people of other nationalities. On the
threshold of referendum in Nagorno Karabakh, the authorities present
their approximate figures – 145.000, i.e. as many as in 1989. The
international organizations functioning in Karabakh think this figures
exaggerated and bring their own – 100.000.

Even if the figures Stepanakert presents are real, there is no
re-settlement going on in Karabakh and surrounding territories. In
effect, population density in Karabakh is lower than in any province
of Armenia. Meanwhile natural and agricultural conditions in Karabakh
are not more tolerable than the republican average.

AZERI LEADERS INTOXICATED BY OIL DOLLARS – ARMENIAN DEFENCE MINISTER

Mediamax News Agency, Armenia
Oct 11 2005

Yerevan, 11 October: Armenian Defence Minister Serzh Sarkisyan today
expressed the opinion that “some Azerbaijani leaders are intoxicated
by oil dollars”.

Serzh Sarkisyan said this at a ceremony to award the Armenian
servicemen who participated in the international peacekeeping operation
in Iraq, Mediamax news agency reports.

“During the Karabakh war, we proved our right to life, we defended
our independence and ensured the security of our people. Maintaining
the high combat readiness of our army today, we must ensure a peaceful
solution to the Karabakh problem. This is especially important today
when some Azerbaijani leaders seem to be intoxicated by oil dollars
and are singing the same old tune.

The current situation may be compared with the early 1990s, when
Azerbaijani leaders expressed a desire to resolve the Karabakh problem
in a short time in a military way, to seize Nagornyy Karabakh, Armenia
or part thereof. The hostilities showed that this was not a desire,
but only a myth and insanity which vanished on the battlefield. Now
that 11 years have passed since the hostilities, they are singing
the same old song again,” Serzh Sarkisyan said.

RA DM: ARMENIA NEEDN NOT CHANGE ITS STRATEGY

ARKA News Agency, Armenia
Oct 11 2005

YEREVAN, October 11. /ARKA/. Armenia needn’t change its strategy, the
RA Minister of Defense Serge Sargsyan told reporters when commenting
on the recent statement of the Deputy of the RF State Duma Alexander
Fomenko, who said that adoption of the NATO standards by Armenia will
complicate the strategic partnership of the latter with Russia.

According to the Minister, the Deputy doesn’t understand correctly the
international and NATO standards. According to Sargsyan, the standards
of NATO imply transition to NATO armament, ideology and everything
connected with it, while international standards imply availability
of battle-worthy subdivisions in line with those standards. “These are
different conceptions”, he said. Particularly, drawing an analogy with
sport, Sargsyan noted that Russian and American sportsmen use various
standards however achieve the same goal when holding a record in one-
hundred- meter race.

To remind, on Saturday Fomenko stated in Yerevan that adoption of the
NATO standards by Armenia will complicate its strategic partnership
with Russia. According to him, partners should have the same military
standards. If they are different, it will complicate the strategic
partnership between two countries, since Russia is not going to adopt
those standards.

CHESS TOURNAMENT
Laura Grigorian

Azat Artsakh, Republic of Nagorno Karabakh
Oct 10 2005

The international chess tournament in Artsakh with famous players and
grand masters is going on. Though October 7 was a day-off, some of the
grand masters played friendly games with chess fans. In Stepanakert
they had meetings at Artsakh State University, Chess Center, one of
the military units of the NKR Defense Army and the Children’s Chess
School. They had meetings in Shushi, too. The grand masters Dreyev and
Sokolov simultaneously played 20 games with the pupils of the school
(Each played 10 games). At the military unit Levon Aronyan played
10 games, Karen Asrian played 12 games in Shushi, and at the Chess
Center Victor Bologan played 10 games simultaneously. At Artsakh State
University GM Vasily Ivanchuk played 10 games with the chess fans
of the university. The games with Arkady Tovmassian and the head of
the department of physical education Michael Baghdassarian ended in
a draw. The vice rector of Artsakh State University Stepan Dadayan
gave a souvenir to V. Ivanchuk. The grand master told Azat Artsakh:
“I am in Karabakh for the first time but I am fascinated by these
wonderful highlands, as well as the people living here. Armenian
people are very hospitable and kind. I liked to be in Armenia, and
now I like Karabakh even more. My impressions from the tournament are
very bright and interesting. It is good that the people in Armenia
and Karabakh love chess. I wish there were more similar tournaments
and a larger number of famous players took part in them. I wish all
the best to the people of Karabakh, willpower to overcome economic
difficulties.” After 5 tours Ashot Anastasian is leading Group A (17th
category) with 4 points, and Sergey Grigorian (Russia) and Ervin Lami
(the Netherlands) are leading Group B (11th category) with 4 points.

ALL CALM ON THE HORIZON
Comment By Sergei Markedonov
Special to Russia Profile

Russia Profile, Russia
Oct 10 2005

Armenia and Azerbaijan Not Worried About Revolutions

The countries of the south Caucasus could be in for a hot autumn this
year. Georgia, for example, will mark the second anniversary of the
“Rose Revolution” that brought Mikheil Saakashvili to power, but it
is doubtful that the date will take place in a festive atmosphere.

Much discussion about the successes and failures of Georgia’s
revolution still lies ahead, as many of the goals that were set out
by its leaders have yet to be reached. No serious progress has been
made in re-establishing the country’s territorial integrity and a
number of social and economic problems still weigh heavy. What’s
more, many in Georgia accuse Saakahsvili and his team of ruling
with an authoritarian hand, not following democratic principles and
institutionalizing a one-man regime in Georgian politics.

Nevertheless, Georgia remains a sort of beacon for the other countries
in the region, as every election campaign, whether presidential or
parliamentary, held in neighboring states since 2003, have had a whiff
of approaching revolution. This also goes for election campaigns in
entities not recognized by the international community. Abkhazia lived
through a “velvet revolution” of its own almost a year ago, and there
was the approach of revolution in the air in Nagorny Karabakh in June.

Armenia and Azerbaijan are no exceptions in this respect and both
have to face the test of how ripe they are for revolution. Armenia
will soon be holding a referendum on proposed amendments to its
constitution and Azerbaijan will hold parliamentary elections on Nov.

6. In both cases the votes are expected to be more open than
was the case with the presidential election in Azerbaijan and the
presidential and parliamentary elections in Armenia in 2003. This may
be an indicator that the CIS has entered a new, post-revolutionary
phase. The main sign of this new situation is the presence of
election observers from the United States, Europe and international
organizations, whose work is to ensure that voting measures up to
democratic standards. Emissaries from Washington and Brussels are
already busy announcing the conditions for the upcoming elections
in the southern Caucasus, and a certain division of labor can be
seen here. The European organizations are paying closer attention to
democracy in Azerbaijan, while those from the United States are keeping
a watchful eye on Armenia – not surprising, given that Armenia’s
traditional geopolitical position of close relations with Russia and a
firm anti-Turkish line is not entirely to the taste of U.S. diplomats.

In a message addressed to Azerbaijani officials at the end of August,
Rene van der Linden, president of the Council of Europe Parliamentary
Assembly, said, “You must show that you want to and can fulfill the
commitments you made to the Council of Europe and the international
community.”

U.S. Ambassador to Armenia John Evans, for his part, said recently that
the adoption of the proposed amendments to the Armenian constitution
in a national referendum would open up broad new opportunities for
the republic. In Evans’ words, “failure of the referendum would slow
down the democratic processes in Armenia,” and falsification of its
results would set off mass popular protests.

But the presidents of the two countries, Ilham Aliyev in
Azerbaijan and Robert Kocharian in Armenia, have both said on a
number of occasions that they see no revolutions on the horizon
in their countries. Analysts note, however, that there is serious
dissatisfaction among some of the elites both in Armenia and in
Azerbaijan. Both countries face social and economic problems and
the longstanding, unresolved problem of Nagorny Karabakh (which
still pits the two countries against each other). Additionally,
clan dominance – the Nakhichevan-Yerazovsky clan holds power in
Baku, while people from Karabakh run the scene in Yerevan – works
against Aliyev and Kocharian. At various round tables and forums on
the Caucasus in the United States and Europe, the view can be heard
that a democratic revolution in Armenia and Azerbaijan would put an
end to the long-running Karabakh conflict. But are there any real
signs that these two countries could follow Georgia’s path this fall?

It would seem to be too soon to predict the triumph of democratic
revolutionaries in Yerevan and Baku. The current leadership in both
countries enjoys a solid position. Neither country has a fragmented
elite, as was the case in Ukraine, or faces the total privatization
of power, as was the case during Eduard Shevardnadze’s final years in
Georgia. What’s more, in Armenia, Kocharian and his entourage have
attempted to take the lead on revolutionary rhetoric themselves,
embracing democratic slogans and talking of moving closer to Europe.

It was Kocharian’s team that proposed the package of amendments to the
country’s constitution, under question at the referendum, to bring it
into line with European standards. The changes include broadening the
prime minister’s powers (making the post more political, as opposed
to its purely technocratic character at present) and granting the
parliament broader powers. The draft amendments have already passed
through the parliament, with the referendum due to take place on
Nov. 20. The U.S. administration has also expressed its support for
the idea of a referendum.

Kocharian has also stepped up his personal contacts with Saakashvili,
the region’s chief revolutionary. Given that Armenia has a powerful
resource in the Armenian diaspora to support it in its undertakings,
Kocharian and his team have a decent chance of repeating the Moldovan
experience and heading the revolution themselves.

Azerbaijan’s Aliyev is not behind any serious democratic projects of
this type, but he has another card up his sleeve – geopolitics. U.S.

President George W. Bush has spoken on a number of occasions of the
need to deal with Iran. Given the complicated situation in Iraq and
Turkey’s cooling relations with the United States, Azerbaijan could
hypothetically become an important base for a future operation against
Iran. Washington, therefore, has an interest in seeing a strong and
stable state in Azerbaijan, a state that is under control.

An Azerbaijan that is seized and destabilized by internal disputes is
not in the interests of the United States. In this respect, a recent
statement by U.S. Senator Richard Lugar was not a coincidence. “No
orange revolution is expected in Azerbaijan,” the senator said,
adding that the image of Azerbaijan as a country ripe for revolution
was not an accurate one.

But the opposition in both countries has serious plans and is not
willing to make concessions either to a “democratizing,” Kocharian,
or to Aliyev and his geopolitical approach. “Armenia is entering a
new political stage, where we either express our lack of confidence
in the current regime or the regime continues paving the road to its
own reproduction,” Aram Sarkisian, leader of the opposition Democratic
Party of Armenia, said at an extraordinary session of the country’s
parliament on Sept. 1. Isa Gambar, leader of Musavat, the chief
opposition party in Azerbaijan, said that the “world’s attention is
focused on holding transparent elections. If there is any attempt to
break the rules in these elections, the world will see our strength”.

In other words, the elections in Azerbaijan and the referendum in
Armenia promise to be exciting. But an analysis of the people and
potential in the opposition camps in both countries does not bode well
for their chances. The revolutions in Georgia and Ukraine were led by
people who had already held high state office, had broken with the
current regime, and had staked their reputation on something more
than simply being a part of the government. They already had real
experience of state management. Saakashvili was justice minister and
had made a name for himself in the government while Shevardnadze
was still in power. The speaker of the Georgian parliament, Nino
Burdzhanadze, already held the post before the revolution. In Ukraine,
Viktor Yushchenko had earlier served as prime minister and was very
popular with a significant part of the public, while Yulia Tymoshenko
had already served as deputy prime minister. Neither the Azerbaijani
or Armenian opposition can boast figures of this stature or experience.

But the situation could still change before the end of October. If
either of the two governments slips up strategically, for example by
bringing too much pressure to bear on the opposition, this would play
into the hands of would-be revolutionaries and provide an incentive
for their consolidation. Paradoxical though it may sound, it would
be in the best interests of the authorities in both Baku and Yerevan
not to allow any falsification in the votes, all the more so as,
unlike Shevardnadze in Georgia, they do still enjoy a certain level
of the public’s confidence in their countries.

The Karabakh issue is a major trump card for both Baku and Yerevan.

The problem is that the oppositions in both countries, while democratic
on some points, are not so democratic when it comes to Karabakh, and
opposition members on both sides are ready to take an even firmer line
against their opponents than is the case with the current regimes. This
means that a potential revolution in either country is no guarantee at
all of a breakthrough in the Armenian-Azerbaijani conflict. This is
also a serious issue in internal political battles and in the battle
for the backing of the United States and Europe.

Whatever the case, the fall will bring an interesting political season
for the south Caucasus, but whether revolution will be on the menu
depends on the authorities’ actions and the opposition’s ability to
consolidate its forces.

Sergei Markedonov is head of the department for problems of
international relations at the Institute of Political and Military
Analysis.

TERRY DAVIS: THE PROCESS OF NK CONFLICT SETTLEMENT GIVES POSITIVE RESULTS

ARMINFO News Agency
October 6, 2005

STRASBOURG, OCTOBER 6. ARMINFO. “The process of Karabakh conflict
settlement at the level of Presidents and Ministers for Foreign
Affairs of Armenia and Azerbaijan gives positive results,” the
Secretary General of the Council of Europe, Terry Davis says in an
talk with ARMINFO’s correspondent.

Mr. Davis says that he continues to keep his eye upon the situation
in Karabakh, although he resigned from the post of PACE rapporteur
on the Nagorno-Karabakh conflict. The Secretary General adds that he
regularly receives information about the conflict settlement process,
but avoids making public statements concerning the matter. He also
notes that notable progress has been achieved during the last 4
months. The current approach to the Karabakh problem was discussed
during the last visit of the Armenian Minister for Foreign Affairs
Vardan Oskanian to Strasbourg and also with Eldar Mamediarov, the
Minister for Foreign Affairs of Azerbaijan, in the framework of UN
summit. -A-

KOCHARIAN SINGLES OUT SPHERE OF HIGH TECHNOLOGIES AS IMPORTANT DIRECTION OF ARMENIA’S COOPERATION WITH INDIA

Noyan Tapan News Agency, Armenia
Oct 6 2005

YEREVAN, OCTOBER 6, NOYAN TAPAN – ARMENIANS TODAY. Bharion Singh
Sekhavat, Indian Vice-President, who arrived in Armenia on an
official visit emphasized the high level of political relations
between the 2 countries at the October 6 meeting with RA President
Robert Kocharian. India’s Vice-President remembered Robert Kocharian’s
official visit to India paid in 2003 with warmth.

RA President considered Indian Vice-President’s visit to Armenia as
an important step aimed at developing the bilateral relations.

Mentioning the centuries-old interrelations between Armenian and Indian
peoples, affinity of the languages and cultures, the sides noted that
they left their noticeable trace on the peoples and cultures of the
2 countries.

According to RA President’s Press Service, the interlocutors emphasized
rather efficient cooperation of the 2 countries at international
instances with pleasure.

In the opinion of the interlocutors, the economic contacts between
Armenia and India don’t completely reflect the existing possibilities.

RA President singled out the sphere of high technologies as an
important direction of cooperation. India succeeded in this sphere
and Armenia announced the development of this sphere as its priority.

“We expect concrete steps that will enable to form a wider field for
cooperation,” Robert Kocharian said.

It was mentioned that there are already examples of successful activity
of Indian business circles in Armenia. Indian businessmen have made
investments in the sphere of Armenian mining, diamond cutting and
gold procession, India has rendered great assistance to Armenia in
the issue of agricultural reequipment.

The two countries expressed readiness to continue cooperation in
the spheres of science, education as well. It was mentioned that
many Indian youths study in Armenia at present. “Our goal is to turn
Armenia into a center of intellectual services and education,” Robert
Kocharian stressed.

The interlocutors also attached importance to the role of the Indian
Armenian community in the development of the Armenian-Indian relations
mentioning that the community members have completely integrated to
country’s life.

NEGATIVE TRADE BALANCE IN FIRST EIGHT MONTHS AMOUNTS TO $481 MILLION

Armenpress
Oct 06, 2005

YEREVAN, OCTOBER 6, ARMENPRESS: Armenia’s foreign trade in the first
eight months of the year amounted to $1.689 billion. Exports made
$603.77 million and imports reached $1.085 billion. The negative
trade balance was $481.65 million. Not counting humanitarian aid it
was $456.09 million.

Foreign trade growth rate from a year before was 31.4 percent. Twenty
percent of the overall foreign trade was with CIS member countries,
of which 13.6 percent with Russia, 3.1 percent with Ukraine and almost
3 percent with Georgia. Another 39.2 percent was with EU members,
of which 11.5 percent with Belgium, 9.8 percent with Germany and 5
percent with the Netherlands.

Trade with Israel was 8.7 percent, USA-6.4 percent, and Iran -4.4
percent.

U.S. Announces Charges in Massive Scheme to Bribe
Senior Government Officials in the Republic of
Azerbaijan

U.S. Newswire
10/6/2005

To: National Desk

Contact: Herbert Hadad, Megan Gaffney, Heather Tasker,
Bridget Kelly, 212-637-2600, all of the U.S.
Attorney’s Office

WASHINGTON, Oct. 6 /U.S. Newswire/ — Following is a
release from the U.S. Department of Justice:

MICHAEL J. GARCIA, the United States Attorney for the
Southern District of New York, ALICE S. FISHER,
Assistant Attorney General in Charge of the Criminal
Division, and MARK J. MERSHON, the Assistant Director
In Charge of the New York Field Office of the FBI,
announced that VIKTOR KOZENY, FREDERIC BOURKE, JR. and
DAVID PINKERTON have been indicted by a federal grand
jury in Manhattan for allegedly participating in a
massive scheme to bribe senior government officials in
Azerbaijan to ensure that those officials would
privatize the State Oil Company of the Azerbaijan
Republic (“SOCAR”) and allow KOZENY, BOURKE,
PINKERTON, and others to share in the anticipated
profits arising from that privatization. Each of the
defendants is charged with conspiracy to violate the
Foreign Corrupt Practices Act (“FCPA”), which makes it
a crime to offer to pay, or to pay, foreign government
officials in order to obtain or retain business. The
defendants are also charged with related crimes,
including money laundering.

KOZENY was arrested yesterday by law enforcement
authorities in The Bahamas, where he resides, pursuant
to a provisional arrest request made by the U.S.
government. He will appear today before Bahamian
court. The U.S. government intends to make a formal
request for KOZENY’s extradition under the Extradition
Treaty Between the Government of the United States of
America and the Government of the Commonwealth of The
Bahamas.

BOURKE and PINKERTON, meanwhile, voluntarily
surrendered to the FBI’s offices in Manhattan this
morning and are scheduled to be arraigned today in
front of United States District Judge RICHARD C. CASEY
at 1 pm.

Mr. GARCIA, Ms. FISHER, and Mr. MERSHON also announced
that three other individuals, THOMAS FARRELL, CLAYTON
LEWIS and HANS BODMER, previously pleaded guilty in
connection with their participation in this bribery
scheme.

Background

According to the twenty-seven count Indictment
unsealed today (the “Indictment”), VIKTOR KOZENY
controlled two companies, Oily Rock Ltd. (“Oily Rock”)
and Minaret Ltd. (“Minaret”), which participated in a
privatization program in Azerbaijan. Under that
privatization program, Azeri citizens could use free
government-issued vouchers to bid for shares of
state-owned industries that were to be privatized.
Privatization vouchers were bearer instruments that
were freely tradable, and they typically were bought
and sold using United States currency. Foreigners
could also participate in Azerbaijan’s privatization
program and own vouchers, but only if they purchased a
government-issued “option” for each voucher they held.

The Indictment alleges that beginning in July 1997,
KOZENY directed others to purchase vouchers and
options on behalf of Oily Rock and Minaret. According
to the Indictment, these vouchers and options were
purchased using millions of dollars of cash that was
flown into Azerbaijan on KOZENY’s private jet and on
planes he chartered.

The Indictment further alleges that various
individuals and institutions invested together with
KOZENY in privatization vouchers and options. Among
the individual investors was FREDERIC BOURKE, JR., who
made two investments in Oily Rock totaling
approximately $8 million, on behalf of himself and
family members and friends. The institutional
investors included American International Group
(“AIG”), which invested approximately $15 million
under a co-investment agreement with Oily Rock and
Minaret. DAVID PINKERTON, a Managing Director of AIG
in charge of AIG’s private equity group, was
responsible for supervising AIG’s investment in Azeri
privatization. In addition to AIG, other institutional
investors in this privatization venture included the
Wall Street hedge fund Omega Advisors, Inc. (“Omega”)
and its affiliated investment fund Pharos Capital
Management, L.P. (“Pharos”), which together purchased
approximately $151 million in vouchers and options.

The Indictment alleges that KOZENY and the individual
and institutional investors (collectively, “the
investment consortium”) made their investments with
the intent to acquire a controlling interest in SOCAR
upon its anticipated privatization. The Indictment
further alleges that, beginning in August 1997 and
continuing until 1999, KOZENY, BOURKE, PINKERTON, and
others paid or caused to be paid millions of dollars
worth of bribes to Azeri government officials to
ensure that the investment consortium would gain a
controlling interest in SOCAR and be able to reap huge
profits from its ultimate resale in the market.

The Bribery Scheme

The Indictment charges that KOZENY, acting on his own
behalf and as an agent of BOURKE, PINKERTON, and other
members of the investment consortium, made a series of
corrupt payments and promises to pay to a senior
official of the Government of Azerbaijan (the “Senior
Azeri Official”); a senior official of SOCAR (the
“SOCAR Official”); and two senior officials of the
State Property Committee or “SPC” (the “SPC
Officials”), the agency that was responsible for
administering the privatization program. Collectively,
the four officials alleged to have been bribed are
referred to as the “Azeri Officials.”

According to the Indictment, the corrupt promises and
payments to the Azeri Officials took a number of
forms. For example, in August 1997, KOZENY is alleged
to have promised to transfer to the Azeri Officials
two-thirds of the vouchers and options Oily Rock
purchased, and to give the Azeri Officials two-thirds
of all of the profits arising from the investment
consortium’s participation in SOCAR’s privatization.
In return for this “two- thirds transfer,” the
Indictment alleges that the Azeri Officials agreed to
permit the investment consortium to acquire a
controlling interest in SOCAR upon its privatization.

In addition to this “two-thirds transfer,” the
Indictment alleges that in June 1998, Oily Rock’s
shareholders approved an increase in Oily Rock’s
authorized share capital from $150 million to $450
million, and that the additional $300 million worth of
Oily Rock shares was transferred to one or more of the
Azeri Officials as a further bribe payment.

The Indictment further charges that a number of other
bribes were paid to the Azeri Officials. KOZENY and
others acting under his direction allegedly paid more
than $11 million in total to the Azeri Officials in
May and June 1998, of which approximately $6.9 million
was wire transferred to accounts held for the benefit
of certain of the Azeri Officials and their family
members, and millions of additional dollars in cash
were hand- delivered to one of the SPC Officials in
his government office.

KOZENY is also alleged to have arranged for a
representative of the London jeweler Asprey & Garrard
to travel to Azerbaijan in May 1998 to deliver several
gifts of jewelry and other luxury items to the SPC
Officials, who in turn selected the gifts to present
to the Senior Azeri Official on his birthday.
According to the Indictment, the total value of these
gifts was more than $600,000, which Minaret paid.

KOZENY and BOURKE are also charged with arranging for
both of the SPC Officials to travel to New York City
on different occasions in 1998 to receive medical
treatment, for which Oily Rock and Minaret paid.
KOZENY, through Oily Rock and Minaret, also paid for
the SPC Officials’ hotel, meal and other expenses on
these trips, as well as shopping expenses for one of
the SPC Officials at a high-end department store in
the New York area.

The Charges in the Indictment

The Indictment contains a total of twenty-seven
counts. All three defendants are charged with
conspiracy to violate the FCPA and the Travel Act. As
stated above, the FCPA makes it illegal to offer to
pay or to pay money or anything of value to a foreign
government official to obtain or retain business. The
Travel Act makes it illegal to travel or use the mails
or other interstate facilities to carry on certain
unlawful activity, including violations of the FCPA’s
anti-bribery provisions.

The Indictment also contains twelve separate counts of
violations of the FCPA, of which KOZENY is charged in
all twelve, BOURKE in five, and PINKERTON in one.
There are also seven counts of violations of the
Travel Act, of which KOZENY is charged in six, and
BOURKE and PINKERTON in one count each.

Each of the defendants is further charged with money
laundering conspiracy, based on wire transfers of
millions of dollars to purchase Azeri vouchers and
options, which in turn promoted violations of the
FCPA. There are also four separate substantive money
laundering violations, of which KOZENY is charged in
all four, BOURKE in two, and PINKERTON in one.

BOURKE and PINKERTON are also each charged with making
false statements in interviews with the FBI. The false
statement charge against BOURKE alleges that, in an
interview conducted in April and May 2002, he falsely
stated that he was not aware that KOZENY had made
payments to the Azeri Officials, when BOURKE knew that
KOZENY had paid bribes to those officials. The false
statements count against PINKERTON alleges that, in an
interview conducted in February and March 2002, he
falsely claimed that he was not aware that the Senior
Azeri Official had a financial interest in KOZENY’s
investment in Azeri privatization, when PINKERTON knew
that the Senior Azeri Official had such a financial
interest.

The conspiracy to violate the FCPA and Travel Act
count, the substantive counts of violations of the
FCPA and the Travel Act, and the false statements
counts each carry a maximum penalty of five years in
prison and a maximum fine of $250,000 or twice the
gross gain or loss resulting from the alleged
violations. The money laundering conspiracy and
substantive counts each carry a maximum penalty of 20
years in prison and a maximum fine of $500,000 or
twice the value of the laundered funds. Finally, the
Indictment contains a Forfeiture Allegation seeking
the forfeiture by the defendants of $174 million that
was involved in the charged money laundering offenses.

KOZENY, 42, resides in Lyford Cay, The Bahamas.

BOURKE, 59, resides in Greenwich, Connecticut.

PINKERTON, 44, resides in Bernardsville, New Jersey.

Mr. GARCIA praised the investigative efforts of the
FBI, and he said the investigation is continuing.

Mr. GARCIA added, “Corrupt payments to foreign
officials, such as the ones charged in this
Indictment, are a global threat to democratic
institutions and fair competition. We will vigorously
prosecute those who make illegal payments to corrupt
foreign officials.”

Ms. FISHER stated, “Representatives of American
businesses overseas cannot be allowed to bribe their
way into lucrative contracts or illegally purchase the
favor of foreign government officials. Business
conducted abroad must be done with honesty and
integrity. Those who violate U.S. law in their
financial dealings, here or in other countries, will
face serious consequences.”

Announcement Concerning Related Cases

As stated above, THOMAS FARRELL, CLAYTON LEWIS and
HANS BODMER have pleaded guilty in connection with
their participation in this bribery scheme. FARRELL,
who directed voucher purchases for Oily Rock, pleaded
guilty before United States District Judge RICHARD M.
BERMAN on March 10, 2003 to two-counts charging him
with conspiracy to violate the FCPA and violating the
FCPA.

LEWIS, who was a principal of Omega and Pharos and who
oversaw Omega’s and Pharos’s investments with Oily
Rock and Minaret, pleaded guilty before United States
District Judge NAOMI REICE BUCHWALD on February 10,
2004 to the same two charges.

Finally, BODMER, a Swiss lawyer who represented Oily
Rock, Minaret, Omega and other investors in connection
with their investments in Azeri privatization, pleaded
guilty before United States Magistrate Judge FRANK
MAAS on October 8, 2004 to a charge of money
laundering conspiracy.

The case against KOZENY, BOURKE and PINKERTON and the
related cases against FARRELL, LEWIS and BODMER are
being handled jointly by the United States Attorney’s
Office for the Southern District of New York and the
Fraud Section of the United States Department of
Justice. Assistant United States Attorney JONATHAN S.
ABERNETHY, Fraud Section Deputy Chief MARK F.
MENDELSOHN, and Fraud Section Assistant Chief
ROBERTSON PARK are in charge of the prosecution.

The charges contained in the Indictment are merely
accusations, and the defendants are presumed innocent
unless and until proven guilty.

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© 2005 U.S. Newswire 202-347-2770/