The government of Azerbaijan has been secretly lining the pockets of Azerbaijani elites and European politicians to help burnish its reputation.
Using bank accounts at the Estonian branch of Danske Bank, Baku covertly handed out a whopping $2.9 billion between 2012 and 2014, according to the latest investigation by journalists and researchers from numerous European and US media outlets working under the auspices of the Organized Crime and Corruption Reporting Project (OCCRP).
In several cases, the money went to well-connected European politicians, journalists, and businessmen who had praised the Azerbaijani government. The OCCRP and its affiliates are expected to reveal more names in the near future.
Like previous OCCRP investigations, the so-called “Azerbaijani Laundromat” report has sent shockwaves through the Eurasian region and cast a spotlight on corrupt practices used by the local authorities.
Hromadske International spoke with one of the authors of the report, Baku-based OCCRP journalist Khadija Ismayilova, to learn more about the investigation. She says that the first part of the research was carried out in 2016 “when the Italian MP Luca Volonte was accused of receiving bribes from the Azerbaijanis through the Danske Bank accounts.”
Then, several months ago, someone leaked information to the Berlingske newspaper and the OCCRP about the Danske Bank payments.
“During these two months of hard work, we collaborated all together to research, fact-check, [and] get reactions from different people involved in this payment.”
The OCCRP report concludes that, according to the leaked banking records, the money was funneled through four UK companies, whose actions “were clearly coordinated” so that “hundreds of thousands of dollars would enter an account on a given day and be gone by evening.” That cycle was repeated daily.
To and From
According to the investigation’s report, the money came from the Azerbaijani government, the Russian state weapons intermediary export company Rosoboronexport, and a mysterious Azerbaijani limited liability corporation called Baktelekom MMC. It was used to “pay off European politicians, buy luxury goods, launder money, and otherwise benefit [Azerbaijani officials].”
The four UK companies in question — LCM Group Limited, Metastar Limited, Hilux Services LP, and Polux Management LP — were registered under a limited partnership system, which allows owners to hide their identities. They had no operations in the UK and were previously named as payment channels in another case linked to Azerbaijan’s first family — the Italian bribery case against MP Volontè. The four companies have since been dissolved.
“I think the UK government should spend some more effort on finding out who the beneficiaries of these companies were, because some of them ceased their operations now. […] An international investigation should be done to reveal the names behind [them],” Ismayilova says. “The world will only benefit from more transparency in this direction.”
In the wake of the investigation, Danske Bank has admitted it has not been “good enough at monitoring suspicious transactions at its Estonian branch” and that it has since “tightened procedures and controls” and “terminated relationships” with some customers.
“We will not accept Danske being exploited for money laundering or other criminal purposes. We will do everything to prevent it from happening again,” the bank said in a statement to the Guardian newspaper.
Press Under Pressure
The revelation of this complex money-laundering operation comes less than two months after Azerbaijani president Ilham Aliyev awarded 255 apartments to Azerbaijani journalists to mark National Press Day in the country. Four years ago, 155 flats were given out in the same day.
Such “generosity” looks particularly strange in Azerbaijan, an authoritarian state where independent and opposition journalists like Ismayilova face continuous pressure from the government.
Between 2012 and 2014, more than 90 human rights activists, opposition politicians, and journalists were imprisoned on politically motivated charges, according to OCCRP. Ismayilova was arrested twice. The second time, she was sentenced to 7.5 years in prison, but freed around two years later after a successful appeal to Azerbaijan’s Supreme Court.
“Right now [the freedom of speech situation] seems hopeless,” Ismayilova says.
In response to the report, the Azerbaijani government blocked the OCCRP website within the country. The authorities alleged that the OCCRP was carrying out an order from Hungarian-American philanthropist George Soros and the Armenians, with whom Azerbaijan has had a continuous political and military standoff since the Soviet collapse.
“It’s completely absurd,” Ismayilova says. “We expect more retaliation from the government, so the situation is quite dangerous…it is not easy to work in this country, but it is important, so we have to continue.”
/By Maria Romanenko