LONDON (Reuters) - The first target of new British powers to combat the proceeds of suspected corruption is the wife of a jailed Azeri banker who spent more than 16 million pounds at luxury department store Harrods, London’s High Court has revealed.
An anonymity order was lifted after Zamira Hajiyeva, the wife of the former chairman of Azerbaijan’s largest bank, last week lost an appeal against an attempt by authorities to seize a property and a golf course worth about 22 million pounds.
This is the first time British authorities have used an Unexplained Wealth Order (UWO), a power which came into effect earlier this year and aims to force foreign officials suspected of corruption and their families to account for their wealth.
Police say about 100 billion pounds of dirty cash moves through or into Britain each year, buying everything from luxury London homes to whole companies. They say they are focused on cracking down in particular on money from Russia, Nigeria, former Soviet states and Asia.
When a UWO is used the onus is on the owner to show that any asset worth more than 50,000 pounds was obtained legitimately.
Hajiyeva’s husband Jahangir Hajiyev, who was chairman of state-owned International Bank of Azerbaijan (IBA) from 2001 to 2015, was convicted by an Azeri court in 2016 of fraud and embezzlement and sentenced to 15 years in jail.
The Azeri finance ministry said about $3 billion could have been misappropriated by Hajiyev, who denied the charges.
Lawyers for Hajiyeva, who denies any wrongdoing, said that Hajiyev was convicted after a show trial and the circumstances of the case did not meet UWO requirements. They did not respond to requests for comment, but have previously said they would take the case to London’s Court of Appeal.
Britain’s National Crime Agency (NCA) successfully applied for orders against Hajiyeva demanding she reveal the source of her wealth or risk losing the properties.
One order covers a home in London’s Knightsbridge, about 100 metres from Harrods, which was bought for 11.5 million pounds by a company registered in the British Virgin Islands. The other order concerns Mill Ride Golf Club in Ascot, west of London.
Last week, judge Michael Supperstone rejected Hajiyeva’s appeal against one of the UWOs. Supperstone also ruled that Hajiyeva’s name, which previously could not be disclosed, could be made public on Wednesday.
The NCA had alleged Hajiyeva bought two properties using money embezzled by her husband when he worked for the IBA.
Hajiyeva said in a witness statement that her husband was a man of substantial means. Supperstone’s written ruling made reference to a document prepared by Werner Capital from 2011 which stated his net worth to be about $72 million.
Hajiyeva spent 16.3 million pounds ($21.3 million) under a loyalty card scheme at Harrods between 2006 and 2016, using 35 credit cards issued to her by the IBA.
She spent 121,000 pounds at Harrods on a single day, buying unidentified goods from luxury jewellery, perfume and watch brand Boucheron and two weeks earlier splashed out 48,600 pounds on an item from Cartier, court documents show.
However, letters from the bank showed Hajiyev’s net income from IBA was just $29,062 in 2001, rising to $70,648 in 2008.
“Where we cannot determine a legitimate source for the funds used to purchase assets and prime property, it is absolutely right that we ask probing questions to uncover their origin,” said Donald Toon, the NCA director for economic crime.
“Unexplained Wealth Orders have the potential to significantly reduce the appeal of the UK as a destination for illicit income,” Toon said.
Additional reporting by Margarita Antidze in Tbilisi; editing by Stephen Addison and Alexander Smith