Forfeiting the Family Fortune — Javanshir Feyziyev and the Azerbaijani Laundromat

Court documents

Forfeiture proceedings in National Crime Agency v Orkhan Javanshir, Parvana Feyziyeva and Elman Javanshir (case nos. 012001457423, 012001456260 and 012001457504)

• Initial witness statement of Phillip Deeks (27.08.2020, re-submitted and re-dated 07.09.2020) 
• Supplementary witness statement of Phillip Deeks (27.04.2021)
• Supplementary witness statement of Phillip Deeks (22.09.2021)
• Applicant’s opening note (11.10.2021, amended version 25.10.2021)
• Respondent’s opening note (undated)
• Applicant’s trial skeleton argument (11.10.2021)
• Respondents trial skeleton argument (18.10.2021)
• Applicants’ closing submissions (15.11.2021)
• Respondents’ closing submissions (15.11.2021)
• Westminster Magistrates’ Court judgment (31.01.2022)

The lifting of anonymity in MNL v Westminster Magistrates’ Court (CO/1822/2022)

• MNL’s skeleton argument in support of the application for anonymity (29.10.2021)
• BBC’s skeleton argument supporting the lifting of anonymity (28.01.2022)
• Martin Bentham’s skeleton argument supporting the lifting of anonymity (01.03.2022)
• BBC’s further skeleton argument supporting the lifting of anonymity (07.03.2022)
• Spotlight on Corruption’s letter supporting the lifting of anonymity (25.04.2022)
• Westminster Magistrates’ Court ruling on anonymity (09.05.2022)
• High Court’s written reasons for refusing permission to apply for judicial review in MNL v Westminster Magistrates’ Court (17.08.2022)
• BBC’s skeleton argument resisting claim for judicial review (17.10.2022)
• Divisional Court judgment dismissing application for judicial review (17.03.2023)

Documents awaited:

• MNL’s grounds for judicial review 
• MNL’s skeleton argument for hearing on 8 March 2023
• MNL’s skeleton argument in response to the application to lift anonymity 
• Martin Bentham’s skeleton argument resisting claim for judicial review

Summary

When news of the industrial-scale money laundering operation dubbed the “Azerbaijani Laundromat” first broke in September 2017, the UK’s role as a safe haven for dirty money was once again exposed. Leaked bank records from Den Danske bank in Estonia showed that between 2012 and 2014, roughly US$2.9 billion passed through UK-registered shell companies in an elaborate scheme that served to benefit Azerbaijan’s ruling elite. Since then, the National Crime Agency (NCA) has taken steps to recover the vast amounts of dirty money that washed onto UK shores through the Azerbaijani Laundromat.

On 31 January 2022, the Westminster Magistrates Court granted civil forfeiture orders in relation to £5.63 million held across several UK bank accounts by relatives of Javanshir Feyziyev, a sitting member of Azerbaijan’s Parliament. Although the Azeri lawmaker was not himself a party to the forfeiture proceedings, he is central to the case as the seized funds largely came from bank accounts under his control. The total figure seized covers £4.39 million from his wife, Parvana Feyziyeva, £1 million from his son, Orkhan Javanshir, and £240,000 from his nephew, Elman Javanshir.

A large portion of the funds initially frozen by the NCA had been “gifted” by Javanshir Feyziyev to his wife and son so that they could apply for a “golden visa” in the UK. In 2013, Rathbones helped Parvana Feyziyev and Orkhan Javanshir set up investment portfolios of £4 million for purposes of their Tier 1 investor visa applications. It was well known to Rathbones that Javanshir Feyziyev had provided these funds, and enhanced due diligence was undertaken as a result of their status as Politically Exposed Persons. A compliance summary from Rathbones referred to what the court described as “very serious” allegations involving Feyziyev, but the court made no findings in this regard because these negative press reports were unconfirmed and none of the parties referenced them during the forfeiture proceedings. 

The NCA subsequently traced these funds through the complex corporate structures of the Azerbaijani Laundromat. A central component of the Laundromat was the UK-registered Avromed Company LLP, which the court found was a primary beneficiary of payments from other UK-registered entities called Hilux LLP and Polux LLP. Shortly before its Expobank account in Latvia was closed in 2016, Avromed Company LLP made significant payments to the Seychelles-incorporated Avromed Company, which in turn made payments into Javanshir Feyziyev’s own personal account at ABLV bank in Latvia. From this personal account, funds were disbursed, both directly and indirectly, to UK bank accounts held by Orkhan Javanshir, Parvana Feyziyeva and Elman Javanshir.

Shortly before the forfeiture proceedings began in November 2021, the court granted an anonymity order in favour of an individual who has been identified as both a founding shareholder of Avromed Company LLC and the beneficial owner of the Seychelles-incorporated entity bearing the same name which was integral to the Azerbaijani Laundromat. This person, referred to in the proceedings as “MNL”, emerged as an important figure in the evidence presented by the NCA in support of their forfeiture application. 

The British Broadcasting Corporation (“BBC”) and Martin Bentham, a journalist with the Evening Standard, successfully applied for this anonymity order to be lifted. Spotlight on Corruption and Transparency International UK wrote a joint letter in support of this application, arguing for the importance of open justice in this case. MNL persisted with several rounds of legal challenges in an attempt to retain anonymity, but the Divisional Court roundly dismissed his claim in March 2023. 

In May 2023, “MNL” could be named for the first time as Javad Marandi – an international businessman, property tycoon, philanthropist and major donor to the Conservative Party. While no findings of wrongdoing have been made against Mr Marandi and this case was a civil – not a criminal – case, brought against others, his alleged involvement with key persons and companies at the heart of the Laundromat raises a number of unanswered questions with significant public interest. In particular, this and other cases raise whether more robust checks on political donations are appropriate and whether much greater transparency is needed about donors’ access to and potential influence over senior figures in political parties, particularly those in government.

Why does this case matter? 

• The modus operandi of the Azerbaijani Laundromat highlights the importance of strict checks and thorough investigations by Companies House to prevent the UK from being a major destination for dirty money. The money-laundering vehicles of choice in this case were Limited Liability Partnerships (LLPs) which shared several striking features: all were registered in the UK but had overseas corporate partners; all granted power of attorney to third parties to operate their bank accounts at Den Danske in Estonia; and all had millions of dollars flowing through their bank accounts yet these incomes, generated from apparently legitimate business operations, were entirely unknown to HMRC. In spite of welcome reforms in the Economic Crime and Corporate Transparency Act, there remain concerns that not enough is being done to prevent UK-registered LLPs from being abused to facilitate the illicit flow of funds. Companies House needs to be properly resourced and empowered to monitor, verify and investigate suspicious activity by UK-registered companies.

• This case vividly illustrates the abuses of the golden visa regime that occurred during the “blind faith” period between 2008 and 2015 when little or no checks were carried out on applicants’ sources of wealth. A significant portion of the £15.38 million that the NCA sought to confiscate from Orkhan Javanshir and Parvana Feyziyeva had been used to fund their Tier 1 investor visas. While the golden visa regime has now been scrapped, this case underscores the lessons that must be learned – including the need for specialist financial and economic crime expertise within the Home Office’s immigration function and the strengthening of checks to ensure other visa routes are not vulnerable to abuse by corrupt actors.

• The secrecy that characterised the money laundering techniques used by the Azerbaijani Laundromat means the need for transparency in the conduct of court proceedings is all the more important. The anonymity order granted in this case shielded a key figure, “MNL”, from scrutiny until it was successfully challenged by the members of the media with support from civil society organisations including Spotlight. Open justice is vital for the public to be in a position to fully understand what the evidence before the court reveals about how the Azerbaijani Laundromat operated, who it benefitted and whether the UK’s law enforcement tools have been effective in recovering the illicit flow of funds.

The global context

The Azerbaijani Laundromat

On 4 September 2017, the Organised Crime and Corruption Reporting Project (OCCRP) published two reports: “What is a Laundromat?” and “The Origin of the Money”. These reports were based on leaked bank documents from Den Danske Bank in Estonia revealing an elaborate money laundering scheme in which roughly US$2.9 billion was channelled out of Azerbaijan between 2012 and 2014 under the guise of apparently lawful transactions. These funds were deposited into bank accounts based in Estonia and Latvia, and almost immediately transferred on to various companies and individuals associated with Azerbaijan’s ruling elite. One of the individuals identified in an OCCRP report as having allegedly benefitted is Javanshir Feyziyev, through his involvement in the Avromed Company. This particular article was the subject of a libel action brought by Feyziyev which was settled through a confidential agreement between the parties.

The NCA undertook an independent analysis of these leaked bank documents as part of their investigation into the source of funds deposited in UK bank accounts held by members of Javanshir Feyziyev’s family. This evidence was presented to the court through several witness statements by the NCA’s financial investigator Phillip Deeks in support of the forfeiture application. On the strength of this evidence, the court declared it was “entirely satisfied that there was a significant Money Laundering scheme in existence in Azerbaijan, Estonia and Latvia at the relevant time”.

The significance of the court’s judgment lies in its findings about the processes and entities that constituted the Azerbaijani Laundromat. The court traced the “core of this operation” to a “clone” company called Baktelekom, several UK-registered LLPs including Hilux LLP, Polux LLP and Avromed LLP, and various other “shell” companies such as Brightmax Export Ltd. After carefully tracing the numerous transactions involving these complex company structures, the judge reached the following conclusion: “To be clear, it appears to this court that some of the substantial sums of money that [Javanshir Feyziyev] did receive derived from Hilux and Polux who in turn received such sums from Baktelekom in circumstances that I am satisfied related to money laundering and that such sums are recoverable property and are to be forfeited.”

The clone company Baktelekom

Much of the “dirty money” that was washed through the Azerbaijani Laundromat in this case shares a common source in a company called Baktelekom. The court agreed with the NCA’s characterisation that this was a “clone” company, suggestively named to mislead banks into believing it was actually Baktelecom, the well-established, Azeri state-owned telecommunications company. Although Baktelekom channelled approximately £1.4 billion to UK-registered shell companies in the Azerbaijani Laundromat, very little is known about the company. In the criminal proceedings which led to the conviction of Italian MP Luca Volontè, the Italian court observed that Baktelekom has no known employees, no website and no accounts have ever been traced.

Den Danske Bank records show that Baktelekom paid more than US$1.32 billion to Hilux LLP and more than US$212 million to Polux LLP. These were apparently for the supply of steel piping, but the negligible information about Baktelekom in the public domain calls into question the legitimacy of these transactions. Indeed, as the NCA argued, it is “inconceivable … that a company that had apparently imported $1 billion worth of steel piping into Azerbaijan was so invisible”.

UK-registered shell companies

Several UK-registered Limited Liability Partnerships (LLPs) were key to the operation of the Azerbaijani Laundromat. Three featured in the Feyziyev forfeiture proceedings: Hilux LLP, Polux LLP and, to a lesser extent, Faberlex LLP. These LLPs had striking similarities:

• They were all were registered in the UK;
• They all had corporate partners based overseas;
• They all held bank accounts with Den Danske Bank in Estonia;
• They all granted powers of attorney to others in order to operate their bank accounts;
• The very limited information available about them suggests that they had no viable business operations and the contracts they entered into lacked commercial sense;
• Millions of dollars flowed through their bank accounts in the form of large, round-sum deposits uncharacteristic of genuine trading transactions followed by rapid (often same-day) payments out of the accounts;
• No accounts were filed with Companies House and their alleged incomes were unknown to HMRC.

To illustrate these similarities, the NCA pointed to documents from Companies House which reflect that both Hilux LLP and Polux LLP were registered on 26 March 2013 to the same street address in Glasgow, Scotland. The LLPs also share the same Azerbaijani address in the capital Baku. Both provide vague descriptions of their general line of business as “wholesale”. Bank records identify the same Azeri national, Maharram Ahmedov, as having opened both bank accounts and apparently handled the US$1.7 billion transferred through these accounts. However, investigations by OCCRP revealed that Ahmedov is a working class driver who lives in a modest home on the outskirts of Baku, suggesting that he was merely a nominee used to hide the real beneficial owner of Hilux LLP and Polux LLP.

The court found “overwhelming evidence that the ‘invoices’ and ‘contracts’ purporting to support legitimate (and very substantial) business transactions between Baktelekom, Hilux and Polux were entirely fictitious and were produced in order to deceive the bank into opening accounts and allowing the later flow of very significant sums into and out of their accounts so as to mask the underlying money laundering activities of those orchestrating the accounts.” The evidence of a steel expert also helped satisfy the court that these invoices and contracts were “entirely bogus” and that “there was no such legitimate trade”.

Given that entities like Hilux LLP and Polux LLP were at the heart of the Laundromat operation, it is deeply concerning that these UK-registered entities were so easily abused and their suspicious activities went undetected owing to weak Companies House checks. The former Den Danske Bank employee and whistleblower Howard Wilkinson described the UK’s role in the Azerbaijani Laundromat as a “disgrace”. With the help of professional enablers like lawyers, accountants and bankers, these LLPs were set up to allow their beneficial owners to hide behind nominees so that they operate as anonymous companies with a veneer of UK legitimacy.

Avromed Company

In his evidence to the court, the NCA’s financial investigator Phillip Deeks drew attention to the existence of a number of entities that share similar names, including:

• Avromed Company (incorporated in Seychelles)
• Avromed Company LLC (incorporated in Azerbaijan)
• Avromed Company LLP (registered in the UK)
• Avromed Company Ltd (one registered in Belize and another registered in Russia, with very little known about either entity)

Given the lack of clarity about the sources of funds and the nature of business for each of these entities, Deeks suspected that illicit funds had been co-mingled with licit funds and channelled through these entities’ bank accounts in order to disguise dirty money among legitimate business transactions.

Avromed Company LLP (UK)

Den Danske Bank records reveal that a primary beneficiary of payments from Hilux LLP and Polux LLP was another UK-registered entity, Avromed Company LLP. This LLP was registered in the UK on 10 September 2012 and, like the other LLPs, its corporate partners were based offshore and it held a bank account with Den Danske Bank in Estonia. The records indicate that another of Javanshir Feyziyev’s nephews, Ayyub Feyziyev, became the beneficial owner in 2013.

In contrast to Hilux LLP and Polux LLP, however, Avromed Company LLP did file its accounts at Companies House, but these reflect what the NCA described as “an extremely modest operation if they are to be believed”. For the three-year period between 2012 and 2015, the Companies House records reflect a total of less than £60,000 in commission, while the turnover through the Avromed Company LLP’s Den Danske accounts for the same period are in excess of US$202 million, of which more than US$131 came from Hilux LLP alone. The court agreed with the NCA’s expert Robert McAllen that Avromed Company LLP operated as a “front” company which has “a degree of legitimate trade with reputable companies but is also receiving value from sources deemed as shell companies with no economic or business rationale associated with those transactions”.

In 2015, Avromed Company LLP opened a bank account with Expobank in Latvia. Hilux LLP made a series of deposits into this account using the same reference as its deposits into Avromed Company LLP’s Den Danske account. The NCA argued that this pattern indicates Avromed Company LLP used this Expobank account to continue channelling illicit funds after its account with Den Danske Bank was closed. Shortly before this Expobank account was closed in 2016, a series of credits were made to the Seychelles-incorporated Avromed Company, who banked with ABLV in Latvia.

Avromed Company (Seychelles)

The Avromed Company was incorporated in the Seychelles on 17 February 2005. A bank account was subsequently opened with ABLV in Latvia and, as with other entities in the Laundromat, a third party was granted power of attorney to operate the account.  ABLV bank records indicate that the beneficial owner was “MNL”, who was also named in documentation provided to Rathbones on behalf of Javanshir Feyziyev as one of the founding shareholders of the Azeri-based Avromed Company LLC.

The NCA’s analysis of banking documentation shows that the Seychelles-incorporated Avromed Company received payments totalling US$22.32 from Hilux LLP and US$14.21 from Polux LLP, with these funds having mainly derived from Baktelekom. Substantial payments were made out of the Avromed Company’s ABLV account to “MNL” and entities associated with him as well as Javanshir Feyziyev.

Avromed Company LLC (Azerbaijan)

The Avromed Company LLC was incorporated in Azerbaijan on 19 December 2001 with its principal object being the import of pharmaceutical products from Europe and the US into Azerbaijan. The court recorded that, at the time of the forfeiture proceedings, Javanshir Feyziyev’s personal website described him as the General Director (2002 – 2010) and Shareholder (2007 – 2016) of Avromed Company LLC. In 2016, he sold his 25% shareholding to his nephew Elman Feyziyev.

In the forfeiture proceedings, the respondents submitted that the payments Javanshir Feyziyev received from the ABLV account of Avromed Company (Seychelles) were the wholly legitimate dividends from his 25% shareholding in Avromed Company LLC, notwithstanding the fact that the reference for these payments was “account replenishment”. The nub of the NCA’s case, as summarised by the court, was that “monies received by Javanshir [Feyziyev] from Avromed Company LLC came from the commission of criminal offences outside the UK and that the subsequent distribution of funds by him into the accounts of his relevant family members (Parvana, Orkhan and Elman) amounts to a very substantial exercise in money-laundering”.

Brightmax Export Limited

Another important shell company that features prominently in the evidence is Brightmax Export Limited, which was incorporated in St Kitts and Nevis on 14 January 2014. Brightmax has close links to other Azerbaijani Laundromat entities: it gave the same person power of attorney as the UK-registered Avromed Company LLP and gave the ABLV bank the same business address in Baku as the Azeri-based Avromed Company LLC. Although the information given by Brightmax to ABLV bank suggests its business would include the delivery of tobacco products from several identified suppliers, there is no record of any transactions involving any tobacco suppliers at all. 

Instead, between November 2014 and May 2015, Brightmax received payments totalling more than US$24 million from Hilux LLP, with the court finding that these invoices were likely false as with Hilux LLP’s contracts with other Laundromat entities. Javanshir Feyziyev received payments totalling US$3.4 million from Brightmax which were labelled “account replenishment”, like the payments he received from Avromed Company (Seychelles).

Golden visas

While weak Companies House checks allowed UK-registered shell companies to play a central role in the operation of the Azerbaijani Laundromat, the Feyziyev forfeiture case also points to the risk that dirty money may have been laundered into the UK financial system through the government’s flawed Tier 1 investor visa scheme. Funds received by Javanshir Feyziyev through the Azerbaijani Laundromat were subsequently “gifted” to Orkhan Javanshir and Parvana Feyziyeva so that they could maintain UK investment portfolios needed for their “golden visas”.

In the forfeiture proceedings, the NCA relied on Home Office records showing that on 15 July 2013, Parvana Feyziyeva applied to the British Embassy in Baku for entry clearance to the UK as a Tier 1 investor migrant. Three days later, she received this clearance which was valid for entry between 1 August 2013 and 1 December 2016. In order to obtain permanent leave to remain under this scheme, she was required to maintain an investment portfolio in the UK of at least £4 million during this period. 

In 2013, the London-based firm Rathbones set up UK investment portfolios for both Parvana Feyziyeva and Orkhan Javanshir. As a serving member of Parliament in Azerbaijan, Javanshir Feyziyev was categorised as a Politically Exposed Person (“PEP”) under the Money Laundering Regulations. This required Rathbones to carry out enhanced due diligence in relation to both the source of his wealth and the funding used to set up his wife and son’s investment portfolios. Notwithstanding that Parvana Feyziyeva was the main applicant for the Tier 1 investor visa, Rathbones quickly identified that her wealth was entirely sourced from her husband. A Rathbones meeting note from 14 November 2013 records that “Although most of the dealings in the meeting were with Mr Javanshir, the applications are done by his wife and son, although the money has been gifted to them.”

It is striking that Javanshir Feyziyev did not apply for a Tier 1 investor visa himself even though he “gifted” funds for his wife and son’s investment portfolios and would easily have qualified for one on the basis of the documents provided to Rathbones. Feyziyev instead applied to the British Embassy in Baku on 17 June 2013 for a visa as a “Tier 1 investor partner” of the main applicant, Parvana Feyziyev. The NCA pointed out inconsistencies between the supporting documentation for this visa application and the financial records provided to Rathbones. In particular, he declared in his visa application that his monthly income from all sources of work or employment after tax was a mere £100,000 and specified that “My wife holds funds in excess of £1,000,000 GBP available for transfer to the UK”.

The fact that some of the funds used towards Parvana Feyziyeva and Orkhan Javanshir’s investment portfolios have been established by the court to have been the proceeds of crime raises serious questions about the due diligence undertaken by Rathbones and the checks undertaken by the Home Office. The golden visa scheme during this “blind faith” period not only facilitated the flow of illicit funds into the UK, but also served to lend a certain respectability to individuals looking to settle in the UK on the basis of their suspect wealth. Indeed, this is reflected in the argument advanced on behalf of the respondents in the forfeiture proceedings: 

“The money was invested in the most transparent way imaginable – by creating investments that satisfied our government’s requirements under our Tier 1 Visa system. This process involved the fullest disclosure of the source of the funds and of the relationship between JF [Javanshir Feyziyev] and the account holders. It is absurd that this is now characterised by the NCA as some sort of layering or money laundering process.”

UK court developments

Civil forfeiture proceedings

During the course of 2019, the NCA successfully obtained freezing orders in respect of Orkhan Javanshir’s Lloyds accounts (granted January 2019), Elman Javanshir’s Lloyds accounts (granted February 2019), and Orkhan Javanshir and Parvana Feyziyeva’s Rathbones accounts (granted October 2019). These freezing orders were extended until September 2020, when the NCA applied to permanently confiscate the total amount of £15.38 million frozen across the six accounts held by these three family members of Javanshir Feyziyev.

As these were civil forfeiture proceedings brought under section 303Z14 of the Proceeds of Crime Act 2002 (POCA), the NCA had to satisfy the court that, on the balance of probabilities, the money in each of these accounts was “recoverable property”, meaning that it had been “obtained through unlawful conduct”. The court held that this definition must be given a “reasonably broad interpretation so as to be able to recover illicit funds from not only the criminals who may be found to have retained such illegitimate funds, but also so as to be able to follow the funds and remove them from others into whose hands they have been passed”.

The court held that evidence of financial flows which bear the hallmarks of money laundering is sufficient to establish that criminal conduct occurred, such that those funds are subject to civil forfeiture under POCA. The key “markers” of money laundering in this case were summarised by the court as follows:

1. The existence and deceptive use of a clone company, Baktelekom, purporting to mirror the legitimate company Baktelecom.
2. The production and use of false invoices and contracts presented to the banks in order to mask the true nature of the flow of funds between Hilux LLP, Polux LLP and Baktelekom.
3. A raft of transfers made in large, precise round sum deposits.
4. The rapid speed of the payments made in and out of these accounts.
5. The lack of transparency and related documentation in respect of the legitimate company Baktelecom.
6. The reason given for the use of Exchange Houses (namely the apparent lack of foreign exchange within Azerbaijan) at a time when the source of billions of US dollars flowing into the core Laundromat companies was Baktelekom, with such funds emanating from its Azerbaijani bank account already in US dollars. 

On the strength of this evidence presented by the NCA, the court identified no fewer than 24 issues which “call out for an explanation” and could not be dismissed as mere “smears” or unreliable hearsay as the respondents and Javanshir Feyziyev had suggested. Yet the respondents submitted no witness statements to the court to establish the lawful source of funds. The court accordingly held that “the failure to provide such answers results in it being perfectly permissible and appropriate for this court to draw an adverse inference”.

While the judgment delivered on 31 January 2022 upheld the core of the NCA’s evidence on the Azerbaijani Laundromat as outlined above, the court ultimately ruled that only £5.63 million out of the £15.38 million that had been frozen was to be forfeited. The details of this partial win for the NCA are set out below.

Parvana Feyziyeva

Of the £5.48 million used for her Rathbones account that had come from Javanshir Feyziyev’s ABLV account, the court held that:

• Two transactions (£1.56 million and £817,556) were recoverable because they passed through Avromed Company (Seychelles) but ultimately derived from Hilux LLP, Polux LLP and Baktelekom;
• One transaction ($1.8 million) was not recoverable because “it appears not to have been possible to trace back where those payments originated before arriving into Avromed’s account”;
• A further amount of £1.9 million could not be traced beyond a Swiss bank account held by Javanshir Feyziyev.

Two further credits to Parvana Feyziyeva’s bank accounts of roughly £1 million each were also forfeited as it was established that these funds derived from Baktelekom. The references used for these two payments were “account replenishment” and “Tier 1 investment”.

Outcome: A total of £4.39 million was forfeited out of the £7.87 million that had been frozen in Parvana Feyziyev’s Rathbones account.

Orkhan Javanshir

The initial funding for Orkhan Javanshir’s investment portfolio came from a £5.4 million loan, guaranteed by his father, from AG Bank in Azerbaijan. Of this £5.4 million paid into his Barclays account, £4.2 million was transferred on to Rathbones. While the court acknowledged some unanswered questions around why a loan had been necessary, it found that there was “insufficient evidence to impugn the said AG loan”.

A further credit of £1.87 million to Orkhan Javanshir’s Rathbones portfolio came from Pasha Bank in Azerbaijan, apparently being the proceeds from the sale of land owned by him in Baku. The NCA abandoned its challenge to the authenticity of the documents underlying this sale, and the court accordingly held that this sum was not recoverable.

However, £1 million was later deposited into his Rathbones account from Javanshir Feyziyev’s ABLV account in Latvia. The court was satisfied that the entirety of this sum fell to be forfeited as it originated in tainted sources:

• Some of this money came from “Brightmax and via the medium of MNL”;
• Other deposits by Parvana Feyziyeva came through the Seychelles-incorporated Avromed Company and ultimately derived from Hilux LLP and Baktelekom.

Outcome: £1 million was forfeited out of the £6.45 million that had been frozen across Orkhan Javanshir’s three accounts.

Elman Javanshir

The deposits into Elman Javanshir’s accounts were relatively small, and only one sum of £240,000 was forfeited. The court described the money laundering technique used to disguise the source of funds as “layering” using several entities, including Brightmax, which made payments to Avromed Company LLC labelled “account replenishment”. These funds were subsequently transferred to Elman’s Barclays account marked “dividends”, but at a time prior to Elman having purchased Javanshir Feyziyev’s 25% shareholding in Avromed Company LLC.  

Outcome: £240,000 was forfeited out of the roughly £1 million that had been frozen across Elman Javanshir’s two accounts.

Conclusion

Although only roughly a third of the frozen funds was ultimately forfeited, the successful seizure of £5.6 million shows how powerful AFOs can be in recovering the proceeds of crime that have been laundered across borders through complex corporate structures. In the wake of the controversial settlement in July 2021 that saw the Javadovs pay £4 million to escape further scrutiny of their wealth and the costly discharge of the NCA’s Unexplained Wealth Order against the Aliyevs in June 2020, the forfeiture order secured should be a real boost to the NCA’s confidence in its fight against dirty money.

The political implications for the UK

Javanshir Feyziyev remains a sitting member of parliament in Azerbaijan. He has also been the chair of the UK-Azerbaijan All Parliamentary Co-operation Committee and co-chair of the EU-Azerbaijan parliamentary Co-operation Committee. A report by openDemocracy revealed that Javanshir Feyziyev enjoys a close relationship with Bob Blackman, the Conservative MP and chair of the Azerbaijan All-Party Parliamentary Group (APPG). Since 2011, Blackman has taken seven free trips to Azerbaijan, with the most recent three visits having been funded by the Azerbaijani parliament or its London embassy. 

For his part, Blackman has reportedly welcomed Javanshir Feyziyev to Westminster on at least two occasions, the first in May 2016 and the second in February 2019. By the time of this second APPG meeting, the NCA had successfully secured freezing orders in respect of UK bank accounts held by Javanshir Feyziyev’s son and nephew. Their engagement continued throughout 2020 when Bob Blackman put down parliamentary motions and lobbied the UK government to side with Azerbaijan in its territorial dispute with Armenia over the region of Nagorno-Karabakh. This adds to growing concern – including from within parliament itself – about the role and funding of APPGs.

The anonymity order

The individual “MNL” emerged as a central figure in the forfeiture proceedings. The NCA’s evidence reveals close business ties between Javanshir Feyziyev and MNL, including documents presented to Rathbones on behalf of Feyziyev that names MNL as a founding shareholder in Avromed Company LLC. The evidence advanced by the NCA and the court’s judgment also detail the instrumental role that MNL allegedly played in receiving and transferring funds from companies at the core of the Azerbaijani Laundromat.

First, MNL is implicated in payments from Avromed Company (Seychelles):

• MNL is identified as the beneficial owner of the Seychelles-incorporated Avromed Company, which received substantial funds into its Latvian bank account from Hilux LLP and Polux LLP that derived from Baktelekom, the companies at the heart of the Azerbaijani Laundromat.
• Between 2005 and 2017, Avromed Company paid out more than US$48 million to MNL himself, more than US$106 million to another of MNL’s companies called Vynehill Enterprises Ltd, and more than US$34 million as well as a further €3 million to Javanshir Feyziyev. The court described it as “perplexing” that some of these payments were simply described in bank records as “account replenishment”.
• Analysing the flow of funds involving Avromed Company, the NCA argued that “the overwhelming implication” is that these payments were not made as part of genuine contracts, but in order to “deceive the bank, and conceal the fact that they were simply payments made for MNL’s benefit. If so, then Avromed (Seychelles) was simply used as a front company for the purposes of money laundering.”

Second, MNL is implicated through his links with Brightmax Export Limited:

• The court implicated MNL in the operation of another shell company in the Laundromat called Brightmax Export Limited, which received more than US$24 million from Hilux LLP between November 2014 and May 2015 on the basis of false invoices.
• Javanshir Feyziyev received payments totalling US$3.4 million from Brightmax, labelled “account replenishment”. The court found that £1 million to be forfeited from his son’s account included onward payments by Feyziyev of “monies from Brightmax and via the medium of MNL”.
• The court noted the NCA’s suggestion that Marandi was the beneficial owner of Brightmax, although observed that his name does not appear on any official entity documents.

From this evidence, it is clear that a better understanding of MNL’s role could yield much-needed answers about the ultimate source and destination of “dirty money” that was channelled through the Azerbaijani Laundromat. It also raises the question of whether the NCA has squarely investigated whether the funds that MNL allegedly received and transferred may be the proceeds of crime. The court’s judgment records in relation to the NCA’s Phillip Deeks that, “When asked whether there was an active investigation in relation to the financial affairs relating to MNL, he said he could ‘neither confirm nor deny’.”

In lifting the anonymity order protecting MNL’s identity, the Westminster Magistrates’ Court commented that “Contrary to what has been promoted on his behalf, as a result of hearing evidence (and submissions) during the course of the 10 day full hearing, I do not consider MNL to be a peripheral figure in relation to the main proceedings. He is, in my opinion, a person of importance to the main proceedings”. The court was also not satisfied that MNL had provided clear and cogent evidence of the harm to his reputation and business interests that would result from his identification in relation to the proceedings. 

The Divisional Court upheld this decision to lift the anonymity protection in a strong affirmation of the importance of the open justice principle. As a result of this decision, in May 2023, “MNL” could be named for the first time as Javad Marandi – an international businessman, property tycoon, philanthropist and major donor to the Conservative Party. 

While no findings of wrongdoing have been made against Mr Marandi and this case was a civil – not a criminal – case, brought against others, his alleged involvement with key persons and companies at the heart of the Laundromat raises a number of unanswered questions with significant public interest. In particular, this and other cases raise whether more robust checks on political donations are appropriate and whether much greater transparency is needed about donors’ access to and potential influence over senior figures in political parties, particularly those in government.