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HomeUKThe link of Tory donor Javad Marandi to a vast money laundering...

The link of Tory donor Javad Marandi to a vast money laundering investigation

A prominent businessman whose foreign companies were investigated for global money laundering is a significant Conservative Party donor.

Mr. Marandi denies all wrongdoing and is not subject to criminal punishment.

The verdict against him is a landmark for press freedom in an era of expanding privacy laws.

The businessman’s spokesman stated, “Mr. Marandi is extremely dissatisfied with the court’s decision to lift reporting restrictions, knowing the reputational damage that will likely result.”

The link of tory donor javad marandi to a vast money laundering investigation
The link of Tory donor Javad Marandi to a vast money laundering investigation

An investigation by the National Crime Agency (NCA) revealed that Mr. Marandi’s overseas business interests played a crucial role in an elaborate money laundering scheme involving one of Azerbaijan’s wealthiest oligarchs.

A judge ruled in January 2022 that the NCA could seize £5.6m [$7m] from the London-based family of Azerbaijani parliament member Javashir Feyziyev.

The court said their British bank accounts received currency from Azerbaijan as part of a “significant money-laundering scheme.”

In October 2021, Mr. Marandi was given anonymity in court to deny this claim.

The High Court found that Mr. Marandi can be recognised as a “person of importance” in the NCA’s case.

Successful international entrepreneur

Mr. Marandi was born in Iran and raised in London, where he currently resides.

His affiliation with the Conservative Party was revealed by reports of his considerable contributions. According to Electoral Commission records, he donated £756,300 between 2014 and 2020.

The Sunday Times reported in February 2022 that he was part of a Boris Johnson-accessing group of large party donors.

The court called Mr. Marandi a “highly successful international businessman” with substantial UK and worldwide commercial interests.

He owns the Conran Shop, Anya Hindmarch Ltd., a luxury handbag company, and a private Oxfordshire club and hotel.

Together with his wife, he oversees the Marandi Foundation, which provides funding for the Prince and Princess of Wales’ charity.

In 2021, Centrepoint hired Mr. Marandi as a special adviser to help it grow its work with disadvantaged youngsters.

The NCA’s investigation, which focused on earlier events, did not include any of Mr. Marandi’s UK enterprises or these organizations.

‘Azerbaijani Laundromat’

The investigation began in 2017 after investigative journalists uncovered a massive money-laundering conspiracy dubbed the “Azerbaijani Laundromat.”

The Organised Crime and Corruption Reporting Project (OCCRP) disclosed that the country’s elite had stolen $2.9 billion (£2.3 billion) from the Azerbaijani people and economy and secreted it abroad. It was primarily for their benefit, but they also sought to bribe European legislators.

Paul Radu, OCCRP co-founder, called the laundrette plan one of the biggest post-Soviet plunders.

“The Azerbaijani Laundromat caused significant damage on multiple levels to Azerbaijan, the European Union, the United States, and other nations,” he said.

“Small businesses lost a lot of money because they deposited with the scandal-plagued bank.”

These revelations prompted the NCA to investigate the Feyziyev family’s finances in the United Kingdom, which led to its application in 2021 to seize a portion of their UK funds and the disclosure in court of the connection to Mr. Marandi.

Money path

According to documents from the NCA’s case at Westminster Magistrates’ Court, the suspicious funds that ended up in the bank accounts of the Feyziyev family in London originated in bank accounts belonging to a company with neither employees nor a record of its activities.

Baktelekom, headquartered in Baku, the capital of Azerbaijan, appeared to be a state-owned company with a nearly identical name.

Judge John Zani determined that “substantial funds from this criminal enterprise” were then transferred to two bank accounts in the Baltics belonging to Glasgow-registered shell corporations.

According to the NCA, a portion of the funds was transferred to accounts associated with Javanshir Feyziyev and Javad Marandi.

A series of companies with the same name, Avromed, played a “central” role in the transmission of this money.

One of them was established in 2005 in Seychelles, with Mr. Marandi as its beneficiary.

According to court documents, Avromed Seychelles received substantial quantities, as depicted in the graph below.

The company received funding from outside sources. According to investigators, the total payout was:
  • $34.8m (£27.8m) to Javanshir Feyziyez
  • $48.8m (£39m) to Javad Marandi
  • Mr. Marandi is the beneficial owner of Vynehill Enterprises, a British Virgin Islands company receiving $106.9m (£85.4)

The judge ruled on the NCA’s request to seize cash from the Feyziyev family, stating, “I am satisfied there is overwhelming evidence that the invoices and contracts purporting to support legitimate (and very substantial) business transactions between Baktelekom, Hilux, and Pollux were entirely fictitious.”

They were created to enable “very significant sums into and out of their accounts to conceal the money-laundering activities of those responsible for the accounts.”

The National Crime Agency informed the court that it would “neither confirm nor deny” the existence of an active investigation into Mr. Marandi’s finances, but the prominent businessman has categorically denied any wrongdoing.

His attorneys informed the court that, between 2012 and 2017, he had to use exchange houses in Latvia and Estonia to transfer dividends legally owned by Avromed and other enterprises.

They stated, “The funds were lawfully earned and transferred, and there is no question of money laundering.”

Naming Marandi

When the NCA’s case against the Feyziyev family was initially brought to court, Mr. Marandi’s attorneys argued that revealing his identity would violate his privacy and cause “profound and irreparable” harm to his reputation, especially since no law enforcement agency had interviewed or contacted him regarding the case.

After the court ruled that the NCA could seize millions from the Feyziyev family’s British bank accounts, the BBC and London Evening Standard argued that it was in the public’s best interest to reveal that some of Mr. Marandi’s overseas holdings were involved in the case.

In May 2022, Judge Zani concluded that Mr. Marandi, commonly known as MNL. Might be named under open justice because he was “significant to the main proceedings.”

This ruling prompted Mr. Marandi to file additional challenges for over a year.

His attorneys were successful in obtaining an expensive High Court review of Judge Zani’s ruling. At this point, the London Evening Standard had withdrawn from the competition.

Two of the country’s most experienced judges ruled last month that the media could identify Mr. Marandi.

They concluded that open justice was a fundamental principle and that anonymity should be permitted only in exceptional circumstances.

“My only surprise is that the anonymity order was granted in the first place,” said Mr. Justice Mostyn. It should never have been granted due to procedural inequity and a clear absence of merit.”

The expression “political bombshell”

Duncan Hames, Transparency International UK’s policy director, said the Conservative Party had questions.

“This is a political bombshell,” he declared. “Today, we learned that a donor of hundreds of thousands of dollars to a British political party was, in the words of the judge, an important figure in court proceedings concerning a significant money-laundering operation.

“This should be concerning not only to those who are concerned about where the money came from. It also shows how easy it is for money to enter political parties without sufficient checks on its sources.”

The former Liberal Democrat representative continued, “It is insufficient to merely verify that a person is on the electoral register. Our political parties must be much more selective about the donors they accept.

A spokesperson for the Conservative Party stated in a statement that the party only receives donations from “permissible sources, namely UK electoral roll-registered individuals and UK-registered companies.”

“Donations are properly and transparently declared to the Electoral Commission, openly published by them, and fully comply with the law.”

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