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Building on a Shaky Foundation

BY ROXANA JIPA, VICTOR ILIE, AND DANIEL BOJIN 

It’s no secret that the family of Azerbaijani President Ilham Aliyev likes to buy expensive buildings around the world, although it’s rarely clear where the money comes from.

But the history of the US$ 7.3 million house at 39 Popa Soare Street in Bucharest’s old city is even murkier than usual, involving offshore transactions, links to corrupt officials and organized crime, insider deals and a peculiar cult of personality for a dead leader.

The house today is the headquarters of the Heydar Aliyev Foundation, a non-governmental organization set up and run by the family of the current Azerbaijani President Ilham Aliyev, the late Heydar Aliyev’s son.

Heydar Aliyev, who died in 2003 at the age of 80, was a former KGB general and first secretary of the Communist Party’s Central Committee in Azerbaijan “who for 30 years ruled his native Azerbaijan with an iron fist,” according to his obituary in the New York Times.

The elder Aliyev also developed a cult of personality around himself, which, thanks in part to the Heydar Aliyev Foundation, persists more than a decade after his death with thousands of portraits of the dead leader on billboards and official structures across Azerbaijan, often shown with his son. Scores of streets, buildings and parks bear his name, statue or image, including as many as a dozen in foreign countries.

But what, exactly, is the Heydar Aliyev Foundation, and what does it do?

In Romania, officials don’t seem to be too sure. When asked about the status of the building at 39 Popa Soare St., the Romanian Gendarmerie and the Ministry of Foreign Affairs give conflicting answers.

For example, the building is guarded round the clock by the Gendarmerie, a law enforcement branch under the Romanian Ministry of Internal Affairs.

"This is a diplomatic building," says one of the gendarmes, asking OCCRP reporters who are filming the building to present their IDs. As he speaks two other gendarmes emerge from a side street.

When reporters ask what diplomatic mission is located in the building, they are told, “the Azerbaijani Economic Representative Offices in Romania.” When reporters ask why the building is identified as the Heydar Aliyev Foundation, a second policeman says the foundation “has a special status.”

The Heydar Aliyev Foundation says on its website that it exists due to "the nation’s wish to express its esteem for the memory of Heydar Aliyev, who entered our history as a builder of an independent state, and the necessity of reflecting his rich moral heritage, underlining the importance for our country of the philosophy of Azerbaijanism and cultivating the national statehood ideas in our children."

The Gendarmerie says they are there to guard unspecified diplomatic interests and not the foundation headquarters. On the other hand, the Ministry of Foreign Affairs says neither the foundation nor the building have diplomatic status.

Whatever the foundation does, the building itself appears to be nothing more than another multi-million-dollar property owned secretly by the Aliyev family. Previous OCCRP and other media stories have noted their extensive purchases in London, Moscow, the Czech Republic and Dubai.

A search through business records reveals that the Bucharest house is owned by a Romanian private company in which the Azerbaijani presidential family is involved via an offshore company. That private company has placed the whole house, more than 600 square meters, at the disposal of the Heydar Aliyev Foundation, free of charge. It also enjoys tax-free status as the foundation’s home.

AN OFFSHORE FAMILY

The members of Azerbaijan’s First Family – Ilham (head of state), Mehriban (First Lady) and their three children, Leyla, Arzu and Heydar Jr. – have been involved in numerous secretive business operations across several continents in recent years. Using offshore companies and middlemen, the First Family took over considerable chunks of the Azerbaijani economy – including gold mines, tourism, telecom companies and banks – while buying up luxury properties in various European and Gulf states.

Azerbaijani journalists who investigated and exposed the presidential family's hidden affairs suffered retaliation. They were first targeted by smear campaigns and then imprisoned on what many rights organizations say are trumped-up charges.

As many as 80 other local activists and political opponents have been arrested after criticizing the Aliyev regime, which is fast becoming one of the region’s more repressive states.

In June 2015, the First Family was actively involved in the organization of the first-ever European Games, a pre-Olympic series of athletic events. The First Lady headed the competition's Organizing Committee. While about 6,000 athletes participated in the competitions, most European leaders boycotted the games in protest over Azerbaijan’s worsening human rights record.

Only a handful of Eastern European officials, including Romania's Prime Minister at the time Victor Ponta, attended the lavish opening festivities at the Heydar Aliyev Stadium in the Azerbaijani capital of Baku.

The Heydar Aliyev Foundation claims that it has official partnerships with at least one ministry in Bucharest, the Ministry of Labor, Family and Social Protection. The Heydar Aliyev foundation also has a relationship with the foundation run by former Social Democrat Prime Minister Adrian Năstase, who served time in prison for corruption.

But in a letter to OCCRP the Ministry of Foreign Affairs insists there is no official partnership with the Azerbaijani foundation: “Over the time, the foundation organized a series of events and actions where different representatives of the Ministry were invited. But there is no formal cooperation agreement between the Ministry and this foundation.”

There is, however, a history of deepening ties between the countries. Romania was the second country in the world to recognize Azerbaijan's independence after the collapse of the Soviet Union in 1991. Since then the relationship has evolved, as Romania is counting on Azerbaijan's oil and gas to reduce its dependence on Russian gas.

President Aliyev has twice received honors in Bucharest, from both President Traian Băsescu and his predecessor, Ion Iliescu. Iliescu was among the few heads of state to meet with both Aliyevs (father and son) in their respective capacities as presidents of the Azerbaijani state.

SECRET OWNERS

According to property deeds, the house on Popa Soare Street is owned by Curzon Properties, a firm whose owners are hidden behind offshore companies. The Romanian firm, registered in Bucharest, was founded on Sept. 8, 2008 and bought the building in Popa Soare Street just two days later. Five days after that, the Heydar Aliyev Foundation moved in, rent-free. Incidentally, Curzon is the name of a gate to Hyde Park in London, just across the street from another Aliyev posh property.

The final price of the house was € 6.5 million (US$ 7.3 million), paid in full by an offshore in Seychelles, Asbet Ltd. - the majority shareholder of Curzon Properties at the time of the sale.

At the time of the sale, Asbet Ltd. was owned by Ashraf Kamilov, an Azerbaijani employee of AtaHolding and one of the shareholders in a bank owned by AtaHolding, a financial group controlled by the Aliyev family. In March 2009, Asbet Ltd. transferred its majority stake in the Romanian firm to another offshore, Ciaba Ltd., registered in the British Virgin Islands.

Documents obtained by OCCRP/RISE Project show Ciaba Ltd. was owned by none other than Arzu Aliyeva, the Azeri president's younger daughter.

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