The Russian Whistleblower
The first public revelations about Pilatus and its Azerbaijani clients came from Maria Efimova, a former employee of the bank. In early 2017, Caruana Galizia met Efimova, a Russian national, about a year after she had been fired from the bank. Efimova had sued Pilatus for failing to pay her salary, and the bank responded by reporting her to the police for misappropriation of funds. She told the reporter that Aliyev’s eldest daughter Leyla had transferred over €1 million from a Pilatus account held by her Dubai-registered company, Sahra FZCO, to an offshore company owned by the wife of Joseph Muscat, Malta’s Prime Minister. Once published, the story immediately turned into a major corruption scandal. A local television station filmed Ali Sadr, the bank’s owner, and Antoniella Gauci, its risk manager, leaving the building in the middle of the same night. Ali Sadr was carrying bags of documents. A few hours later, at about 4 am, a mysterious private jet took off from Malta International Airport, made a stop in Baku, Azerbaijan, and then proceeded to Dubai. The Maltese prime minister vociferously rejected Caruana Galizia’s reporting, and the jet operator said that no one had been on board. But three days later, the reporter broke another story stating that the bank’s main client was Heydarov, Azerbaijan’s Minister for Emergency Situations. Caruana Galizia was killed less than six months later. After her murder, Efimova, who said she feared for her life, fled the country. She was arrested in Greece in relation to the accusations Pilatus had made against her, but a court recently ruled that she will not be extradited back to Malta. The purpose of Aliyeva’s alleged payments to Muscat’s wife are unclear. The prime minister had made several low-key trips to Baku where he had meetings with President Aliyev that did not follow normal protocol for meetings with foreign leaders. He has also publicly praised Azerbaijan’s notoriously rigged elections.
Multimillion Holdings in Dubai
Sahra FZCO opened an account in Pilatus in August 2015. It was used to receive payments from the Aliyev family’s real estate projects in Dubai, according to the three sources. Property records show that Sahra FZCO owns land and a luxury resort on Palm Jumeirah, the man-made island in the shape of a palm tree off the coast of Dubai. The Sofitel Palm Resort & Spa on the east crescent features 361 rooms and suites and 182 residences. According to its advertising materials, it offers guests Polynesian design with a French flair, stunning views over Dubai, and an exclusive half-kilometer-long beach. AccorHotels, a French multinational hotel group, operates the facility. The company refused to divulge its partner in the hotel without their agreement. Sahra FZCO also appears to own another AccorHotels property in Dubai, the Mercure Barsha.
But the Aliyevs’ Dubai holdings don’t end here. Sahra FZCO also shows up as the owner of 16 villas on the Jumeirah Islands, a picturesque, self-contained community of 50 islands. The villas, worth an estimated $30 million, are grouped on a small artificial island surrounded by lakes, water features, and greenery. Each has its own swimming pool and garden. Leyla and Arzu Aliyeva and their brother Heydar are also listed by name as owners of 17 other luxury properties on the Dubai Palm Jumeirah worth over $100 million. There is also a Palm Fronds property listed under “Ilhama Aliyeva,” who uses the same Dubai P.O. box number as Arzu and Leyla Aliyeva. That luxury property is worth about $6 million. It is not clear when the family bought the Dubai properties or where the money came from. But, according to the three sources, the family had been using their Maltese accounts to collect the profits from their Dubai assets. An earlier OCCRP investigation revealed that the Aliyev family also owns an enormous portfolio of luxury hotels in Baku and more than $100 million in real estate abroad. Dubai property data from 2014 to 2016 obtained by OCCRP also show that Nijat and Tale Heydarov, the emergency minister’s sons, also own nine luxury properties on the Dubai Palm Jumeirah Island worth about $33 million.
Sahra FZCO owns something even more valuable that the property in Dubai. According to the three sources, it also controls a majority stake in Gilan Holding, one of Azerbaijan’s largest conglomerates, with major assets in such sectors as textile and food production, agriculture, construction, manufacturing of construction materials, banking, insurance, transport, tourism and professional sports teams. The three sources’ claims were corroborated by records independently obtained by reporters. The Aliyev daughters’ stake in Gilan has never been revealed before. Along with the family’s other known businesses in telecommunications, mining, banking, hotels and construction, it shows that they own vast swathes of the economy of the country they control. The only previously available documentation about the ownership structure of Gilan Holding seemed to show that it was founded in 2005 and owned by the Heydarov family.
GILAN AND THE HEYDAROVS
But now — given the new revelations about the Aliyev daughters’ majority stake in Gilan Holding — it appears that the Heydarovs may have either been posing as the Aliyev family’s proxies, or have transferred or sold control of the company to the first family. The Aliyevs have used other proxies before to try to keep the true extent of their vast empire secret from the Azerbaijani public. The country has shut down public disclosure of shareholder information and most of its large holding companies don’t publish annual reports or other financial details.
It is not just the Aliyevs who have used Pilatus to invest tens of millions of dollars in Europe and operated a network of secretive companies. Following leads from the bank’s documents, reporters found that the Heydarov brothers are the beneficial owners of Heritage Collection, a company that controls three French artisanal businesses famous for their craftsmanship and traditional know-how. Hiding behind the opaque ownership afforded by this company, the Heydarovs acquired JL Coquet, a porcelain maker that supplies dishware for some of the most elite French restaurants; Porthault, a producer of luxury linens; and Leblon Delienne, a company that specializes in producing cartoon character figurines. Philippe Nguyen, director of Heritage Collection at the time, described the company’s strategic plan in a 2014 management report: “Its ambition is to bring together the best know-how” and “acquire 15 companies, each among the best in its sector.” But even the company’s managers and employees were not aware of its real owners. The manager of one factory said to Le Monde: “It’s incredible, it’s been three years now that my questions have gone unanswered. I had imagined everything: Shareholders from the Gulf, Uzbekistan. Not Azerbaijan. Why the secrecy?”
The French companies, which employ 180 people, were bought in 2014 and 2015, when they were on the brink of bankruptcy. Heritage is seemingly a French holding, but in fact 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 transactions in Luxembourg have raised red flags at French banks that dealt with the transactions, prompting them to alert the French anti-money laundering authority. According to sources familiar with the transactions, the Heydarovs have also used the bank to invest €3.9 million in a luxury property in Marbella, a popular seaside resort in the south of Spain, and €2.5 million in the grand Soviet-era Meshakhte sanatorium in the spa town of Tskaltubo in western Georgia, where they plan to build a four-star hotel. The sources also said the Heydarov family owns other corporate structures through proxies. Reporters have found that these companies own nearly €40 million in properties in the United Kingdom and Spain. Reporters were not able to independently confirm direct ownership through records. Editors’ disclosure: Khadija Ismayilova, an OCCRP reporter who contributed to this story, was jailed for 18 months by the Azerbaijani government in 2015-2016. Additional reporting by Anuska Delic, Karina Shedrofsky, Anne Michel, Lejla Camdzic, and Chris Benevento. occrp.org