Leyla and Arzu Aliyeva used a network of wealth managers to conceal their ownership of assets via a complicated web of shell companies and offshore bank accounts that bore signs of potentially suspicious activity, according to the reports of several financial investigators, including Serbian forensic accountant Miroslava Milenović,[11] Northern Ireland-based forensic accountants Harbinson Forensics, and New York-based investigators Duff & Phelps.[341]
The network centers on Farnoush Farsiar, a British-Iranian private banker. While working at Emirates NBD, a Dubai bank, Farsiar met Hamidreza Ghanbari, a fellow Iranian émigré who also worked at the bank. The pair left Emirates NBD in 2014 for new opportunities—namely, managing the wealth of investors, including politically connected Azerbaijanis. Ghanbari did so via Pilatus Bank, a Maltese bank subsequently shuttered over systemic failures to comply with anti-money laundering regulations, while Farsiar—who at that stage had begun referring to herself as an “independent family advisor”—worked via a web of UAE shell companies that held accounts at Pilatus Bank.[341]
Financial experts such as wealth managers are “gatekeepers” who guard the entrances to the international financial system, according to the Financial Action Task Force (FATF), and the most significant cases of money laundering by politically exposed persons (PEPs) rely on these experts to set up structures to disguise the source and ownership of funds.[1345] *
Farsiar features an astonishing 5,000 times in Pilatus Bank records. Investigators who trawled through the records found that she had acted as the protector of several trusts set up for the benefit of a network of high-risk Azerbaijani clients, chief among them Leyla and Arzu Aliyeva and Tale and Nijat Heydarov, the sons of Azerbaijan’s Emergency Situations Minister Kamaladdin Heydarov.[11] [341]
According to the FATF, the use of trusts, corporate structures, legal arrangements, and intermediaries to obscure beneficial ownership by PEPs from autocratic and corruption-prone regimes is a red flag for suspicious financial activity.[1294]
Farsiar was married to London-based fund manager Thamer Aidi (now deceased). Aidi, in turn, was the business partner of Robert John Baker, an Australian chartered accountant who also featured frequently in Pilatus Bank records. Together, Baker and Aidi ran a financial consultancy in Guernsey called Paddington Partners Ltd. In 2012, Baker and Aidi signed a letter of engagement to run all the business interests of the Heydarov family.[586] [15] [948] [949]
Between 2013 and 2017, Baker and Farsiar played “a significant role” in managing Leyla and Arzu Aliyeva’s finances, according to forensic investigators.[11] The pair signed payment instructions on behalf of offshore shell companies owned by the Aliyeva sisters, facilitating a series of multimillion-dollar transfers on their behalf.[948] [949] [11]
One of the major conduits for this activity was Palma Management Consulting DMCC, a company registered in Dubai’s Multi Commodity Free Zone. Palma was one-third owned by Baker, with Aidi owning the remaining stake. Palma held accounts at Pilatus that “might have been used as a payment hub,” according to investigators, who recommended that Maltese authorities examine this with the help of UAE financial crime police.[146] [11]
The use of offshore corporate structures by PEPs to disguise the origin of funds is a red flag for potentially suspicious activity, according to the FATF.[1345] The UAE, in particular, has a poor track record of complying with requests to cooperate with overseas financial crime investigations, having been temporarily placed on FATF’s grey list of tax havens in 2022 due to “strategic deficiencies” in its investigation and enforcement of money laundering.[1352]
Financial investigators traced 117 payments to Palma’s UAE bank account, including from Sahra FZCO, Raphael Investment Limited, Davinci Holdings Limited, and Picasso Holdings Limited—all of which were owned by Leyla and Arzu Aliyeva.[11] [146]
The sisters’ main UAE holding company, Sahra FZCO, sent a six-figure sum to Palma.[11] [586] Between December 2015 and January 2016, Sahra made two payments totaling $876,580 from its Pilatus dollar account to Palma’s accounts at Pilatus Bank.[11] [586]
According to investigators, a total of nine companies paid into Palma’s bank account, including Furies Bia Investments Limited, a UAE company used by Farsiar and Baker to manage the Aliyeva and Heydarov accounts.[11] [341] In November 2015, Furies Bia Investments received $1 million from Sahra FZCO.[11] [5]
Furies Bia Investments is closely linked to Plato Capital, a Dubai-based investment fund founded by Farsiar;[209] it owns 1% of Plato Capital’s Azerbaijani subsidiary, which is ultimately controlled by Farsiar.[1033] [1032] [11] [1034] [1090]
* The Financial Action Task Force (FATF) is an international body that develops and promotes policies to protect the global financial system and sets standards for money laundering controls.
