Pandora Papers Show Crown Estate Bought £67M Building From Ruling Family Linked To Corruption
A huge leak of data related to offshore company structures revealed the company that manages the Queen’s property assets on behalf of the British public bought a London asset that appears to have been owned by the ruling family of Azerbaijan, which has frequently been accused of corruption.
The Crown Estate has started an internal review into the deal that saw it buy 56-60 Conduit Street in Mayfair for £67M in August 2018 in a joint venture with Norway’s sovereign wealth fund, the Guardian reported.
The building was bought from a company called Hiniz Trade & Investment, which is based in the British Virgin Islands, one of the largest offshore jurisdictions used by wealthy individuals to minimise tax payments and reduce transparency around their holdings.
Data known as the Pandora Papers leaked to the International Consortium of Investigative Journalists and reported by media outlets around the world showed that Hiniz was at one time owned by Arzu Aliyeva, the daughter of Azerbaijani President Ilham Aliyev.
Ownership of the company was then passed to her grandfather, Arif Pashayev, who then placed the company into a trust in 2015, the Guardian said. It said it was not possible to ascertain the initial source of the funds used by Hiniz to buy the building for £35.5M in 2009.
The building at 56-60 Conduit Street is part of the portfolio of assets that the Crown Estate and Norges Bank Investment Management own on and around Regent Street. It is an office building with ground-floor retail.
Human rights groups and the EU parliament have called for investigations into Aliyeva and his family, and the country has been consistently linked to human rights abuses, election fraud and systemic corruption, with the president and his family having been accused by investigative journalists in Azerbaijan of profiting from state deals.
“Before our purchase of [the building] we conducted checks, including those required by UK law,” a spokesperson for the Crown Estate said. “At the time we did not establish any reason why the transaction should not proceed. Given the potential concerns raised, we are looking into the matter.”
It added it had been “provided with details of the ultimate beneficial owner of Hiniz Trade and Investment Limited, but no other ownership details”.