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November 9, 2024

Greetings From Amsterdam,

In this edition of OCCRP Weekly, we’ve got our mind on luxury real estate bought with illicit funds.

We’ll start in the U.K., where a leaked investigative document reveals how the former chairman of an Azerbaijani bank relied on an old friend (and loose banking oversight in Luxembourg) to move money he embezzled around the world — then bought up British properties with the proceeds. Next we’ll explore how inflated government contracts in The Philippines may have paid for Dubai properties in a gated community and a luxury complex.

Plus, read our answers to tough questions on The Crime Messenger investigation, and find out how to join reporters in person next week for a Tribute to Journalists award ceremony.


** New Investigations
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** Embezzled Azerbaijan Funds Moved Through Major Luxembourg Bank, U.K. Police Say.
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The wife of Jahangir Hajiyev, the jailed former chairman of the International Bank of Azerbaijan, agreed to forfeit a luxury London townhouse and a U.K. golf club in August after a landmark case found the multi-million-pound properties had been “purchased as a result of criminal activity.”

It was the first time that a U.K. court had prosecuted an Unexplained Wealth Order — a law enforcement tool for investigating assets suspected of being paid for with dirty money.

Now OCCRP has obtained a detailed witness statement ([link removed]) from the case which sheds new light on how funds embezzled from the state-run bank flowed through the heart of Europe and into the U.K., where they were funneled into property for Hajiyev and his family.

The 242-page statement from a National Crime Agency investigator claims the funds were siphoned through an account at Banque Internationale à Luxembourg — and that a Luxembourg-based Azerbaijani financier set up bank accounts and companies around the world to allow that to happen.

The NCA witness statement alleges that these companies moved vast amounts of money out of Azerbaijan — often in convoluted patterns through various companies and jurisdictions globally. Bashirov then helped make purchases on behalf of Hajiyev and his family.

Most of the 10 million pounds used in 2013 to purchase the Mill Ride Golf Club in Berkshire, for instance, traveled from Azerbaijan in four parts to shell companies in other jurisdictions that were “associated” with Bashirov, before making their way through a British Virgin Islands company set up by Bashirov, the account at the Banque Internationale à Luxembourg associated with Bashirov’s main company, and then two Luxembourg shell companies.

Bashirov has admitted to setting up many of these companies, but insists he didn’t know the funds that moved through them were stolen.
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“Our part was only this: To organize companies, to arrange for investments to go through these companies,” he told an Azerbaijani interviewer last year.

“What happened to this money after it went into the project? That’s not my department.”
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He was charged in Luxembourg last month with money laundering, forgery and abuse of professional obligations.

Hajiyev was sentenced to 15 years in prison in Baku in 2016.

Banque Internationale à Luxembourg itself was fined 4.6 million euros by Luxembourg’s financial regulators in 2020 due to weaknesses in anti-money-laundering procedures. It’s unclear if the bank did anything to halt Bashirov and Hajiyev’s efforts. But experts say the NCA evidence raises questions about Luxembourg’s already-scrutinized banking sector and how well it is enforcing regulations.


** Read ([link removed]) the full story ([link removed])
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** More On Azerbaijan:
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This story is part of The Baku Connection ([link removed]) , a collaboration led by Paris-based Forbidden Stories to continue the reporting of jailed journalists from Azerbaijan-based outlet Abzas Media.

Read past work by OCCRP and partners from 2017 exposing the Azerbaijani Laundromat ([link removed]) . Hajiyev’s bank was a key part of this money-laundering scheme, which moved funds into Europe on behalf of Azerbaijani elites.

Explore more of our reporting on why it matters that Azerbaijan is set to host ([link removed]) the world’s leading climate conference starting on Monday.
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** More OCCRP News
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** Central Figure in Philippines COVID Corruption Scandal Spent $20M on Dubai Property
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A central figure in an alleged scheme to squeeze the Philippine government for $130 million in overpriced medical supplies during the pandemic spent more than $20 million on property in Dubai ([link removed]) leaked real estate data shows.

Lin Weixiong, the financial manager for Pharmally Pharmaceutical Corp, purchased a $16.3-million plot of land in a gated Dubai community and a $4.7-million luxury development as the pandemic raged in spring of 2021, according to leaked real estate transaction data obtained by OCCRP. Months later, the Philippine Senate began hearings to investigate inflated government contracts with Pharmally.

In fall 2022, records reveal that Lin sold the gated property, securing a $6.8-million profit for him and its co-owner, Michael Yang — an economic advisor to former Philippine President Rodrigo Duterte, and the person allegedly responsible for securing the contracts with Pharmally.

Lin was indicted this May for graft. Yang has testified in Senate hearings for the case but has not been charged in the Pharmally scandal; separately, he has been asked to testify to lawmakers about his alleged links to drug traffickers and has been named in a case at the International Criminal Court investigating Duterte’s deadly “war on drugs.”


** Read the full story ([link removed])
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** OCCRP Recognition & Events
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In the Washington, D.C. area? Get tickets to the International Center for Journalists’ 40th Anniversary Awards Dinner ([link removed]) . Our Senior Middle East and North Africa Editor Rana Sabbagh will be honored with the Knight Trailblazer Award, while John-Allan Namu, co-founder of our member center Africa Uncensored, will be receiving the Knight International Journalism Award.

Sabbagh has spent more than four decades building a vibrant investigative reporting culture in the Middle East and North Africa — one of the most dangerous regions of the world for journalists to expose official wrongdoing. Namu is a dogged reporter and media entrepreneur who has been at the forefront of investigative journalism in Kenya for nearly two decades, exposing corruption and highlighting its impact on citizens.

Earlier this week, we took to Reddit to host an “Ask Me Anything” ([link removed]) about our recent investigation, “The Crime Messenger ([link removed]) .” The collaboration with 12 media partners across Europe and Canada exposed how Sky ECC encrypted phones were a key tool for criminal plots ranging from drug trafficking to murders — and how the company relied on criminals themselves to sell the phones.

The virtual event was led by Stevan Dojčinović, an OCCRP editor who also runs the investigative newsroom KRIK in Serbia, where horrifically brutal gangs were some of Sky’s biggest fans; Hakan Tanriverdi, a German journalist with Paper Trail Media, which is releasing a multi-part podcast on Sky; and Frédéric Zalac, a Canadian reporter with CBC/Radio-Canada, who dug into the roots of the Vancouver-based company and its distributors. See what they said ([link removed]) in response to questions about challenges in the investigative process, whether they foresee a new encrypted service filling Sky ECC’s void, and how widespread law enforcement crackdowns have been since European police decrypted the platform.

Dojčinović was also part of a discussion hosted by The Globe and Mail in Toronto this week ([link removed]) , as one of the reporters profiled in the 2023 book "Moral Courage: 19 Profiles of Investigative Journalists ([link removed]) ." OCCRP editor Paula Holcova and reporter Khadija Ismaylova were also profiled in the book by psychiatrist Anthony Feinstein exploring why investigative journalists are drawn and committed to their often dangerous work.

Until next week.
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P.S. Thanks for reading the OCCRP newsletter. Feel free to reply to this email with feedback, thoughts, or questions.

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