I: The House of Guli

Guli Collections provided a minor if exotic diversion from the Donna Karan and Calvin Klein Spring Collections at New York Fashion Week last autumn. Gulnara Karimova piqued curiosity with a relaxed spin on ethnic tradition as she presented exquisite, hand-crafted products from her newly expanded fashion label. Guli’s tiered dresses and flowing skirts and harem pants had all been cut from traditional Central Asian textiles and fabrics that included warp ikats and organic silks, patterned madras and Tajik bekasam, knitted atlas and handmade shoyi. Each ensemble was accessorised with gold-embroidered and chain-stitched leather bags and deluxe items from the GULI jewellery line.

The collection reflected Gulnara’s split style, her dual personality: a self-conscious combination of Uzbek tradition and Western aspiration. Whether flogging ethnic fabrics to foreigners to feed a million dollar couture addiction or opening up Central Asia to the most elite fashion houses on the planet, her activities have not escaped controversy. This is partly due to who she is, the clan she belongs to. Her father, Islam Karimov, President of Uzbekistan, is notorious for boiling opponents alive and ordering the indiscriminate slaughter of rural protesters in broad daylight. He owns the entire state machinery of Uzbekistan and uses it to enrich and protect his relations and allies. The House of Guli is not exempt from state-size extortion and global nepotism, and operates against a background of extreme social exclusion and exploitation.

Gulnara Karimova began her fashion career designing exclusive pieces of jewellery for wealthy friends after training at the Fashion Institute of Technology in New York. She spent the early Nineties flitting between Manhattan and Harvard, collecting qualifications and avoiding her Afghan husband, a chauvinistic businessman based in New Jersey. After finally abandoning this dismal marriage, she returned to Tashkent with her children and concentrated on building GULI into a global luxury brand. Later, while working as Uzbekistan’s envoy to the UN Office at Geneva, she struck up an advantageous and lasting friendship with Caroline Gruois-Scheufele, then Vice President of Chopard. This close relationship resulted in a collaboration between GULI and Chopard that was due to be unveiled at the Basel Watch and Jewellery Trade Fair in 2008.

It never happened. Chopard bluntly withdrew on the eve of the show because of the growing controversy surrounding Gulnara and her father’s grisly regime. By 2009, a Chopard spokesman bluntly denied any connection to GULI, dismissing their earlier association as a one-off collaboration between Karimova and Gruois-Scheufele. Clearly, a venerable European luxury institution would not allow itself to be tarnished by unsavoury Central Asian ties, regardless of personal loyalties within the company. (Gulnara and Caroline remain close pals, cruising the same Swiss social circuit and attending each other’s parties in Cannes and Tashkent.)

Gulnara’s troubles actually began with UNICEF. The official, financial justification for her couture activities (still, she maintains, a mere “hobby”) is charity. All profits are fed straight into Gulnara’s youth projects and charity funds in the dirt-poor rural regions of Uzbekistan – in close cooperation, she claims, with the UN Child Fund. But this ‘co-operation’ has been exposed by UNICEF itself as non-existent, a lie: their offices in Tashkent and Geneva angrily deny any involvement with either Guli or Chopard. UNICEF, in fact, led a global campaign against forced child labour in the cotton fields of Uzbekistan, notably exposing Gulnara’s father. By the time Guli Collections debuted in New York, UNICEF had joined forces with Wal-Mart, Macy’s, Nike and hundreds of other fashion brands and retailers in boycotting Uzbek-sourced cotton. (On this point, Chopard also balked.) If the growing controversy had any affect on Gulnara, then she revealed nothing. Dining with fashion pals Sonia Rykiel and Oscar de la Renta while grabbing all the plaudits and contacts the fashion hacks and retailers had to offer, Gulnara sailed through New York Fashion Week and moved on.

On to Tashkent and her October fashion gala, Style.uz – with Oscar and Sonia and Valentino all following the glamorous, risqué Central Asian cash caravan. This is Gulnara’s prize event: an annual showcase that attracts world-class designers and entertainers, entrepreneurs and speculators. In past years, Rod Stewart, Julio Iglesias and Sting sang at gala concerts for million dollar fees, while fashion luminaries Kenzo and Guy Laroche and Revillon ran catwalk displays and workshops. In 2010, MaxMara stood out among the labels choosing to burnish Gulnara’s fashion credentials and flog her internal retail empire. Jose Carreras took to the stage at the Palace of International Forums to close the week’s cultural festivities. Money flowed through Forum Fund coffers. British Ambassador Rupert Joy proudly endorsed Gulnara’s endeavours (and fragrant personage) at a news conference that enraged human rights activists. When Sting was accused of hypocrisy, greed and idiocy for taking $2million to play the Tashkent Opera House in 2009, he sullenly defended himself by saying, “I have come to believe that cultural boycotts are not only pointless gestures, they are counter-productive” and “the concert was, I believe, sponsored by UNICEF.” One year on, and in even worse circumstances, the very notion of a cultural boycott looked more remote and meaningless than ever. Nobody there even cared to mention UNICEF.

Meanwhile, Gulnara was proving to be an unstoppable, unreflective, dynamic, slightly unhinged and paradoxical regional force. She seemed, even, to exceed the remit of her father’s banal brutality. She looked good, and in the refined and hollow world in which she moved, this provided a passport to success and legitimacy. Recording songs with her pop star chum Julio Iglesias in New York City or clinging onto the arm of Nat Rothschild at Kensington cocktail parties, an atmosphere of irresistible danger hung around her – something unsavoury yet attractively outré. And this wasn’t just to do with Daddy boiling people to death in Jaslyk prison or sending soldiers to shoot down crowds in the Fergana valley. She had her own reputation, too.

II: Tashkent Wildlife

Buried deep within last year’s Wikileaks deluge was a series of diplomatic cables from the US embassy in Tashkent describing Gulnara as “the most hated women in Uzbekistan” and “a robber baron” who had acquired crude oil contracts “in a deal with a local mafia boss.” The cables, composed by junior diplomats who had toured Tashkent’s nightclubs and embassy parties, also focused on the social activities of Gulnara’s younger sister, Lola.

While growing up, Gulnara and Lola Karimova followed the young heiresses of Moscow and Paris in their search for role models outside the Central Asian brat packs. By their mid-twenties, they had learnt exactly how to exploit their father’s power structure and how to have a lot of fun doing it. With her particular appetite and ambition, Gulnara created a new (and extreme) template, while compact, pretty, precise Lola refined the model. More closely tailored to the efficient and patriotic Yulia Tymoshenko mode than couture groupie Guli, Lola kept business close to home. Like her sister, she set up GONGOs to educate orphans and save starving children and cloaked herself in UNESCO accolades, but she was, at heart, always a home girl. She took over Tashkent’s most exclusive and fashionable clubs, Barkhan and Basha, thereby snatching executive stakes in the city’s violent, vice-ridden nightlife.

Her clubs entertained a rough, rich mix of diplomats and foreign contractors, local gangsters and government officials, and remain the only venues in the city to openly sell illegally imported alcohol. The leaked US cables drew a vivid picture of Lola arriving in her Porsche Cayenne S Sports Utility Vehicle (“one-of-a-kind for Tashkent”) and after “taking her prominently reserved booth amidst all the action and protected by four bodyguards,” drinking and dancing until morning with her “thuggish-looking boyfriend.” In this swirling centre of political corruption and organized crime – the cables also highlighted the proximity of gangsters to politicians in Tashkent – Lola ruthlessly, and resourcefully, carved out her own territory through hostile takeovers and family contacts.

But Gulnara was the innovator in this sphere, and Lola looked contrite by comparison. Linking international social climbing to massive state corruption, mob tactics to fashion design, Guli pioneered a unique and unstable style. Inside Uzbekistan she built a fashion and retail empire, colonising Tashkent shopping space and Uzbek airwaves. Her TV and radio stations – again set up under the auspices of the all-embracing Forum Fund children’s charity with its fake UNICEF endorsement – pumped out the songs and videos of her alter ego, GooGoosha. Her magazine, Bella Terra, also peddled GULI and GooGoosha merchandise and printed her personal health, wealth and beauty tips.

In 2005, GooGoosha appeared like a glazed apparition out of the gun-smoke of Andijan. Already a self-described poet and designer, Gulnara’s brief detour into music was an impressively mad move in a country famous for its extravagant progressive rock scene and exquisite devotion to the lute. GooGoosha’s folky synthpop took control of the media channels, much as Ceca’s turbo-folk captured the Serbia of Milosevic, though with less popular licence. After cutting a gloopy duet with Julio Iglesias (something of a stalwart in the Guli saga), she released her first and so far only single (‘Unutma Meni’) complete with a promotional video that looked like a Roger Dean fantasy rendered in CGI.

This was, obviously, a stroke of genius: a wild move still unrivalled by any of her Central Asian or Russian contemporaries or competitors. But as TV-Markaz endlessly rotated GooGoosha’s one and only video, growing business interests and investments revealed a serious, hard-edged operator at work. “Most Uzbeks,” noted one US diplomat, “see Karimova as a greedy, power hungry individual who uses her father to crush business people or anyone else who stands in her way.” NGO reports and transnational lawsuits began to expose and confirm in some detail her brutal, break-neck accumulation of Uzbek real estate, media and industry. Gulnara, patron of the Arts and saviour of Uzbek youth, could, it turned out, give Russian gangsters and Ukrainian oligarchs a good run for their loot.

III: GONGO Queens & Gangster Capitalists 

The pace of events accelerated in 2005. It was the year of the Cedar and the Tulip, a time tinged Orange and Rose. A wave of defiance swept from Ukraine and the Levant into Central Asia and the Middle East; Mubarak and Lukashenko, Putin and the House of Saud, all felt its surge. In Kyrgyzstan, in March, armed crowds chased Askar Akayev and his thieving family out of the presidential palace in Bishkek; they fled, in a helicopter, to Kazakhstan.

Karimov had watched this drama unfold on live TV, so when revolt erupted in the Fergana Valley in the middle of May, he was ready. Army units quelled mass protest with machine guns in the desperate town of Andijan, killing hundreds. This was a gory threshold for the entire region and wrecked Uzbekistan’s strategic relationship with the US and most of Europe. It also exposed the brittle, unstable reality of Karimov’s rule, and the fragile security of his own family. With no obvious dynastic succession, and no guarantee of stability or security beyond excessive state violence or the indulgence of Chinese and Russian leaders, a secure “exit strategy” was suddenly required, some insurance against political and personal oblivion. Available solutions could only include more money, power and violence. Or, less obviously: a pop video, a contract with Chopard and a chain of couture boutiques.

Gulnara was already a prolific and eclectic empire builder; after 2005, she simply stopped being discreet about it. Dug deep inside her father’s state machinery, she extorted and threatened with the full force of corporate money and security muscle behind her. She grabbed what she wanted and terrorised business rivals, threatening them with “kidnapping, incarcerations, malicious prosecutions on trumped-up charges, sham trials, torture, sexual assaults, and possibly death,” according to lawsuit papers filed by a Texan loose tea company evicted from the Uzbek market by her machinations. Her ex-husband’s Coca-Cola bottling plant in Tashkent was another victim: charged with tax violations and assaulted by military police, he surrendered all internal assets to state authorities, leaving them in Gulnara’s hands.

Gigantic sums of money flowed through holding companies and commercial properties, to be transferred into family trusts and offshore bank accounts. These sums, their source and destination remained mysterious, although a Swiss business journal felt able to place Karimova among the world’s 300 richest people in 2009. “I have a lot of friends who have things like restaurants and hotels and who restore buildings,” she stated in a 2004 interview, “but that does not mean that these things are mine.” As they expanded and proliferated, her investments proved difficult to disguise. An omniscient media and retail empire puffed her profile and pushed her merchandise. She brought the country’s main mobile phone operator and a controlling stake in its biggest cement factory. She acquired a tourism company in Dubai, snatching commercial rights to all Uzbek travel to the Emirate (inviting unsavory and probably false accusations of sex trafficking). She acquired major shares in the oil, gas and textile industries and used the revenue to found a wealthy football club. A network of shadow companies advanced her interests, permeating almost every profitable sector of the Uzbek economy (including loose tea) and leading back to one intriguing Swiss conglomerate, Zeromax.

Founded in the lovely lakeside tax haven of Zug in 2001, Zeromax grew to be the single largest foreign investor in Uzbekistan. By 2005, it operated hydrocarbon pipelines, agricultural and textile plants, mined bentonite and gold, extracted oil and gas; it owned a chain of petrol stations and shares in national banks. Its proprietor and chief executive, Mirodil Jalolov, was a close business partner and confidante of Gulnara. Jalalov negotiated multi-million dollar deals on her behalf and oversaw her various vanity projects, including the construction of the Palace of the Forums and the FIFA ambitions of her football club, Bunyodkor. This duo, within a decade, almost colonised a country.

The power and methods of Zeromax at its peak – mob tactics with state backing – were clearly demonstrated by the partition of the British Gold mining firm Oxus. In 2006, regional tax and customs authorities charged Oxus with breaching Uzbek tax laws; the company allegedly owed $225 million in unpaid rates, customs duties, fines and penalties. Despite the enormous amount of money involved, all charges were dropped as soon as Oxus directors agreed to sell a substantial chunk of their Amantaytau Goldfield venture to Jalalov, who then joined their board. By acceding to this forced asset strip Oxus secured their Uzbek operations, but under conditions of state sufferance. Jalalov gained at their expense, with full state assistance, but even he would not escape the malignant intrigues of the Karimov clan for long.

The resource monopoly Zeromax enjoyed proved unstable and unsustainable; Uzbekistan’s oil and gas fields were just too tantalizing to be ignored by the big regional players. Russian energy giants Gazprom and Lukoil raged at Jalalov’s hegemony and relayed their anger to Karimov through the diminutive channel of Dmitry Medvedev. Gazprom Investholding’s chairman Alishar Usmanov – notorious thug, football financer, Uzbek ex-pat – already enjoyed good relations with the Karimovs. Charmed by Gulnara’s physical assets, he had paid her an $88 million dollar bribe to secure control of Uzbekistan’s natural gas reserves (an exchange first reported by ex-ambassador Craig Murray).

This deal established a financial and strategic partnership that redefined Uzbek geopolitics; with Russian money and diplomatic support, Karimov was able to expel US forces from their K2 military base in late 2005. This reversal was secured by Usmanov and Gulnara’s backroom transaction on behalf of Putin and Karimov; a diplomatic spat with Condoleezza Rice, in full Freedom March mode after the Andijan massacre, simply provided a political backdrop. Gazprom gained huge import contracts from Karimov and funded key investment projects in Uzbekistan, including exploration work in Ustyurt and a geological examination of the (rapidly receding) Aral Sea. The unholy alliance of Usmanov, Karimov and Jalalov reaped enormous rewards for all interested parties until rivalry, greed and incompetence finally blew the pact apart. Gulnara was at the centre of this drama; she was, to some degree, its central actor.

In the end, Zeromax could not pay back their loans or tax arrears. Prestigious building projects ground to a halt. Assets were seized by the National Security Service and several hundred employees were sacked. Jalalov was briefly detained by police before being released and scurrying back to his last remaining redoubt, the company office at Zug. Regime financiers transferred Zeromax shares to the state energy company Uzbeknettegaz and Gazprom’s major rival in the Uzbek energy market, Lukoil. The conglomerate had collapsed in on itself with debts topping $4 billion; those owed money included Gazprom itself, several German construction companies, Ukrainian oligarch Rinat Akhmetov, and the entire Bunyodkor football team. Karimova had embezzled large sums of this enormous debt in her offshore accounts and luxurious properties in Moscow, Geneva and Spain. The sheer scale of her theft debilitated Zeromax and crippled national energy production, provoking a severe fuel crisis that still afflicts the country today.

Zeromax was also undermined by a series of grandiose construction projects, all instigated by Gulnara. The prestige and scale of these buildings severely aggravated Jalalov’s predicament. The centre piece was to be a gigantic kitsch palazzo — the grandly titled Palace of the Forums — built to celebrate the 18th anniversary of Uzbek independence. The putative purpose of the building was to host charity events and political conferences, but it was a largely cosmetic edifice, arising from the narcissistic daydreams of Gulnara. Having agreed to an impossible completion date, Jalalov lived on-site, anxiously surveying the construction work from his caravan. As the doomed deadline approached, he was seen frantically thrusting money into the hands of the German construction workers, begging them to work overtime.

Their other great project – a 35,000-seater, open-air stadium for Bunyodkor – has yet to be completed. When Zeromax collapsed, the construction cranes simply stopped, steel beams swinging in mid-air. Bunyodkor FC is itself testament to Gulnara’s vulgar hubris and global vision; it is barely a legitimate football club at all, but a recent confection bankrolled by Jalalov and mentored by Gulnara’s chum, former FC Barcelona president Joan Laporta. Jalalov spent billions attempting to buy fixtures with top European clubs and scooping Rivaldo and Scolari with stratospheric wages. Referees showed routine bias towards Bunyodkor, known by weary opponents as “the team of the daughter of the President.” During one tense match against a rival Tashkent team, Jalalov was seen rampaging along the touchline waving a pistol at the players. Bunyodkor’s Superclub aspirations ended with the liquidation of Zeromax, although half a stadium still stands; the partnership with Barcelona departed with Laporta, and Rivaldo and Scolari both terminated their contracts once they realised there was no money left. There is a rumour going around Tashkent that the recent hike in traffic fines is designed to raise funds to finish the deluxe stadium – which is, after all, due to host the U-20 Women’s World Cup next year. But for now, the German construction firms remain unpaid, cranes are still motionless and weeds grow through the cracks.

In the end, the implosion of Zeromax, with all its personal and financial fallout, did not really affect Gulnara at all. As one former assistant candidly explained, “it accomplished its mission. It laundered the money.” After Zeromax had been dismantled, and the spoils shared, Karimov made an important speech in Tashkent, which concluded with some menace: “we will have no oligarchs.” Jalalov was expendable. Zeromax directors had subverted the state with their own illicit smuggling activities and made enemies at the heart of the regime. As her assistant indicated, “Gulnara doesn’t need this; she needs to look clean for European society.”

The aggressive seizure of state assets by Zeromax amounted to a desperate hording of wealth by the elderly Karimov; the realignment with Russia and Putin, via Gazprom, established strategic security after scares in Andijan and Kyrgyzstan. Gulnara paid a critical, and exorbitant, role in this illicit acquisition; she also, alongside Lola, helped disguise its sources and methods. Part of this involved Gulnara’s self-promotion in New York and Cannes and her ambassadorial dabbling in Geneva and Madrid; paying pinheads like Sting and Rod Stewart to play gigs in Tashkent was also part of the political camouflage.

Furthermore, the Karimova girls peddled a charity masquerade, presiding over an internal explosion of GONGOs. Gulnara was an indiscriminate charity maven, decorating projects with UN initials and lauding Fund Forum connections with careless abandon. The latter was used as an all-purpose vehicle to carry fashion shows and charity balls, sports tournaments and pop concerts, geopolitical seminars and diplomatic ceremonials. The Palace of the Forums, once completed, hosted her summits and catwalk galas, all in the name of her charities, which split and expanded, to incorporate women’s aid, cancer, sports programmes, an Uzbek symphony orchestra, and so on; she was photographed for an Uzbek society magazine dressed in couture finery amongst its white marble German interiors and neo-Speer colonnades. In the same year, she presented her diplomatic credentials to the King of Spain and published an academic paper on regional security in the journal of the Carnegie Endowment for International Peace. So at a certain point this blizzard of activity stopped making any sense. It did, however, serve to hide her as it promoted her, a paradoxical  and entirely suitable arrangement.

In fact, Lola was the more adept and committed GONGO queen. In this sense she was less of a riddle than Gulnara, but more of a mystery. Lola’s interests stayed limited and low-key, paying stable dividends. Her property portfolio cut into the dark heart of Tashkent nightlife, but her daytime employment remained impeccable. So impeccable, in fact, that she received glowing testimonials from the European Commission, UNICEF and UNESCO in a libel court case brought against the French magazine Rue89 earlier this year (she lost). The European Union Action Programme felt able to allocate E3.7million to Lola’s central charity, The National Center for Children’s Social Adaptation, with no notable qualms. Her strong links to EU institutions and UN endorsements paid testament to Lola’s canny, cautious style. She embezzled wealth on a minute scale in comparison to her sister, and built her reputation outside of Uzbekistan without courting controversy. She is now rumored to be the favored daughter, her father’s anointed successor.

Such are the latest rumors. Whatever the case, Gulnara’s mad decade of activity, her detours and crazes, grand larceny and mafia tactics, aesthetic exuberance and vaulting ambition, global racketeering and cultural transgression – all this has been exemplary and extreme, even amongst the raucous brat packs of the post-Soviet states. She’s led the way; minted a style nobody can quite match. The purpose of all of this is sometimes hard to gauge, often not; the effect is an impoverished and brutalised country that she has robbed blind in order to leave behind.