Azerbaijan’s ruling elite used a secret $2.9 billion slush fund for years to pay off European politicians and make luxury purchases, according to an investigation which comes amid continued accusations of human rights violations against President Ilham Aliyev’s government.
A report published on September 4 by the Organized Crime and Corruption Reporting Project (OCCRP), says thousands of payments were channeled through four shell companies in Britain between 2012 and 2014 to buy “silence.”
Aliyev’s government on September 5 rejected the findings.
“Neither the president, nor members of his family have any relation to the charges contained in the report by the Organized Crime and Corruption Reporting Project,” said a presidential press statement issued in Baku on September 5.
The report, released on September 4, says thousands of payments were channeled through four shell companies in Britain between 2012 and 2014 to buy “silence.”
The report, The Azerbaijani Laundromat, found millions of dollars from the slush fund ended up in the accounts of companies and individuals across the globe.
A collaborative effort between the OCCRP and several media outlets in Europe, Russia, and the United States, the report said the origin of the fund was unclear “but there is ample evidence of its connection to the family of President Ilham Aliyev.”
Government opponents and rights groups have accused the government of the oil-producing Caspian Sea country of systematic corruption, vote-rigging, and the politically motivated persecution of opposition politicians, activists, and journalists.
The report says some of the money went to pay off at least three European politicians, one journalist, and businessmen in a lobbying effort aimed at deflecting criticism of Baku over its human rights record.
“This intensive lobbying operation was so successful that Council of Europe members voted against a 2013 report critical of Azerbaijan,” The Guardian newspaper said.
Banking records leaked to the Danish newspaper Berlingske, which sparked the investigation, show multiple payments to several former members of the Council of Europe’s Parliamentary Assembly (PACE), The Guardian reported.
The Council of Europe, Europe’s top rights watchdog, is investigating alleged corruption over the vote, the BBC has reported.
Among those mentioned by the report as beneficiaries of the fund were several members of PACE.
One of them is Eduard Lintner, a German ex-lawmaker and member of the Christian Social Union, the Bavarian sister party to Chancellor Angela Merkel’s ruling Christian Democrats. Another is Italian Luca Volonte, the ex-head of PACE’s center-right group, The Guardian reported.
Following the release of the report, PACE’s legal affairs committee introduced a last-moment amendment to a new report on human rights in Azerbaijan, which had previously been scheduled for debate on September 5. The new text urges the government of the president, Ilham Aliyev, to investigate the Laundromat schemes without delay.
“The assembly notes with great concern reports linking the Azerbaijani government to a large money-laundering scheme,” says the amendment, which was passed after heated debates among deputies meeting in Paris on September 5.
“The assembly urges the Azerbaijani authorities to start an independent and impartial inquiry into these allegations without delay and, furthermore, cooperate fully with competent international authorities and bodies on this issue.”
The fund operated during a period, according to the OCCRP, when the Azerbaijani government “threw more than 90 human rights activists, opposition politicians, and journalists into prison,” including Khadija Ismayilova, an investigative journalist and contributor to RFE/RL’s Azerbaijani Service.
“Azerbaijan’s corruption turned out to be contagious and it has tainted international organizations,” Ismayilova told Current Time TV, a Russian-language network run by RFE/RL in cooperation with Voice of America.
“International organizations — I hope — will stand up for their standards and will launch investigations into politicians who have been bribed by Azerbaijan’s government through such money-laundering mechanisms,” said Ismayilova, who contributed to the OCCRP report.
Azerbaijan’s presidential press office, however, asserted that the project was the work of George Soros and those working for the billionaire American philanthropist.
“The dirty deeds of George Soros need to be investigated,” the press statement said.
Soros has been accused by some authoritarian leaders of allegedly using his money and influence to organize antigovernment protests and anticorruption campaigns in some eastern European countries in order to undermine elected officials.
His Open Society Foundations (OSF) are active in 100 countries, and have supported civil groups in Eastern Europe and the Balkans since the mid-1980s.
The OCCRP says on its webpage that it is funded by grants, some of which come from the Soros’ Open Society Foundations. The OCCRP also receives funding fromGoogle and the National Endowment for Democracy — a U.S.-based nonprofit foundation as well as the U.S. and Swiss governments.
The report says at least half of the $2.9 billion came from an account held in the International Bank of Azerbaijan by a shady shell company allegedly linked to the Aliyevs.
The next two biggest contributors to the fund, according to the report, were two offshore companies with direct connections to a “regime insider.”
Those close to, or part of, the regime not only handed out slush-fund cash, according to the report, but pocketed money for themselves, including Yaqub Eyyubov, Azerbaijan’s first deputy prime minister.
Ali Nagiyev and his family were all “major users of the system,” the report says. Nagiyev is th official in charge of battling corruption in Azerbaijan.
Aliyev was first elected president in a tightly controlled vote in October 2003 after being tipped by his long-ruling father, former KGB officer and Soviet-era leader Heydar Aliyev, as his favored successor.
Heydar Aliyev died in December 2003.
With reporting by RFE/RL’s Azerbaijani Service