Azerbaijan’s most powerful families have been using offshore networks to make investments across Europe and the Middle East, a new report by the Organized Crime and Corruption Reporting Project (OCCRP) reveals. The revelations are another in a long line of damning recent investigations digging up unsavory dirt on the Caspian state's financial dealings.
The illicit networks, connected through Malata’s Pilatus Bank, are run by the children of President Ilham Aliyev and the country’s Minister of Emergencies Kamaladdin Heydarov, the OCCRP reported.
The previously unreported assets include one of Azerbaijan’s largest conglomerates, luxury properties in Dubai, and a hotel development in Georgia, among others.
The Pilatus accounts held by the Aliyev family were under investigation by Maltese journalist Daphne Caruana Galizia. She was murdered by a car bomb in October last year.
Ilham Aliyev’s two daughters were Pilatus’ biggest clients.
A recent report by Malta’s Financial Intelligence Analysis Unit found that of the bank’s 150 clients, the vast majority were “politically exposed” or citizens of Azerbaijan. Last month, the bank’s Iranian owner was charged with money laundering and evading sanctions on Iran. Malta’s authorities froze the bank’s assets in response.
One of the banks first clients, beginning in August 2015, was Sahra FZCO – a company controlled by the Aliyev sisters. The company owns luxury resorts and land in Dubai, the OCCRP has revealed. The total value of the assets is reportedly worth over $100 million.
Dubai property data from 2014 to 2016 obtained by the OCCRP also showed the emergency minister’s sons own nine luxury properties worth about $33 million on Dubai's Palm Jumeirah Island.
Sahra FZCO also reportedly owns a majority stake in Gilan Holding, previously thought to be owned by the Heydarov family. The company is one of Azerbaijan’s largest conglomerates, with investments in a wide range of sectors from food processing, agriculture and construction to banking and finance.
Baku’s ruling elites have long tried to keep its financial activities hidden from the public. Public disclosure of shareholder information is forbidden, and large holding companies there rarely publish annual reports or other financial details.
Azerbaijan’s powerful minister of emergency situations has also accumulated a vast portfolio of investments, earning the nickname “Minister of Everything Significant.” His sons are reportedly active in France, owning the Heritage Collection, a company which controls three French artisanal businesses.
The French companies, which between them employ 180 people, were bought in 2014 and 2015, when they were on the brink of bankruptcy. The Heritage Collection, which now controls them, itself has a complex ownership structure. It is owned by a Luxembourg company, which was bought by a Maltese company, which in turn is owned by two New Zealand trusts.
The report also reveals that the Heydarov brothers used the Pilatus bank to invest in both a Spanish sea resort as well as the Soviet-era Meshakhte sanatorium in the Georgian spa town of Tskaltubo.
Other entities run through proxies have been shown to have connections to the Heydarov family. According to the OCCRP, the proxy companies own nearly $49 million in properties in the UK and Spain.
The report can be read in full here.
Bradley Jardine is a freelance journalist who covers the Caucasus.