23 September: several thousand people gather in Baku for a protest rally of the National Council of Democratic Forces, under the slogan ''Return the money stolen from the people!''. (c) Aziz Karimov/Zuma Press/PA Images. All rights reserved.It’s been a busy last few weeks for Sofia’s City Prosecutor Office, which has launched an investigation into Kalin Mitrev, the Bulgarian representative to the European Bank of Reconstruction and Development. In Slovenia, a presidential candidate dropped out of the race. In the UK, former Liberal Democrat leader Tim Farron has called for a full investigation into the whereabouts of dirty money channeled through UK offshores to buy influence and powerful friends.
The reason for all this commotion is the revelations surrounding a new money laundering scheme dubbed the “Azerbaijani Laundromat”, released by the Organized Crime and Corruption Reporting Project (OCCRP) together with international investigative media outlets and Belingske. Stories of offshores, investments and businesses owned by members of the ruling Aliyev family have adorned international publications for years. This is hardly the first investigative exposé of corruption and money laundering schemes commonly used in Azerbaijan — just remember the Panama Papers.
So what makes the latest round of revelations so special? In the days since their announcement, I’ve had time to chew over the question. As executive director of OCCRP Paul Radu told me, this was the first time investigative journalists have actually gained access to bank accounts, and revealed the actual beneficiaries of these huge transactions. Radu added that the funds were used not just to purchase luxury goods and politicians in Europe, but that countries like Iran had used Azerbaijan’s slush fund to bypass sanctions.
Unlike ever before, these revelations reveal the extraordinary lengths to which Baku will go in order to whitewash criticism and buy praise
These revelations concern me, not only as an Azerbaijani but also as a journalist. Unlike ever before, they reveal the extraordinary lengths to which the government in Baku will go to whitewash criticism of the country’s dismal human rights record — with a little help from its foreign friends.
A serving of caviar diplomacy
The time frame indicated in the investigations is significant. In 2012, the Azerbaijani leadership tasted what an international outcry on human rights abuse at home meant while hosting the Eurovision song contest. By this point, the regime had already started making useful friends at the Council of Europe thanks to what Berlin-based think tank ESI described in its 2012 report as “Caviar Diplomacy”.
Their report is an excellent explainer for anyone trying to understand how Azerbaijan’s laundromat works. Caviar Diplomacy was about “winning and retaining the stamp of legitimacy” — and win Azerbaijan certainly did when it came to finding positive assessments about the country’s internal democratic progress.
In some cases, these friendly voices needed a little gift. At least, this may have been the case with German politician Eduard Lintner. Lintner, a Christian Social Union politician, allegedly received a total of 819,500 euros between 2012-2014. He also led a German mission to Azerbaijan to observe the rigged 2013 presidential elections, though concluded that the contest had been held with “German standards”. The now retired politician has since denied benefitting from the slush fund, insisting that the money was received through an NGO he established to promote Azerbaijani-German relations after stepping down from the Council of Europe.
The German CSU parliamentarian Eduard Lintner. Like several other European politicians, Lintner has highly praised rigged elections held by Azerbaijan’s autocratic regime. Photo CC-by-SA 3.0: Togodumnus / Wikimedia Commons. Some rights reserved.
European politicians once called for sanctions and suspended the Azerbaijani delegation’s voting rights at the Council of Europe’s Parliamentary Assembly (PACE). That tone began to change some time after the presidential elections in 2008 and referendum in 2009 that removed presidential term limits. Instead of calling for sanctions over Baku’s human rights violations, they now call for “patience” (in the words of former British Liberal Democrat MP Michael Hancock).
Others joined these calls for patience. Delegates from Baku argued there was scope for progress despite the falsifications, irregularities and shortcomings to which even they readily admitted. But the highlight of Azerbaijan’s “caviar diplomacy” really showed its true impact in 2012 when PACE voted against a draft resolution on political prisoners in Azerbaijan. This served as a green light for the authorities in Baku to launch a crackdown against civil society. They went after journalists, rights defenders and political activists, while making deep changes to legislation governing NGOs and the media.
Parliamentary elections in 2015, and another country-wide referendum held in 2016 were no different. Aleksander Nikoloski, a Macedonian MP from the VMRO-DPMNE party who headed the PACE mission to Azerbaijan said the result expressed the will of the people of Azerbaijan and was a “step forward towards safe, stable and sustainable development of the country”, while other MPs stated the results were democratic and took place according to international standards.
Beyond business as usual
Praise for these elections was music to the ears of the Azerbaijani government. While the regime’s threshold for criticism has never been too high, it has certainly stepped up its game.
When in 2015, OCCRP published an investigation revealing the hand of Finnish-Swedish telecommunications firm TeliaSonera assisting the president and his family to acquire more than $1 billion, the president’s top aide Ali Hasanov called the work “unfounded”, “false” and “primitive”. The most recent revelations have prompted the government in Baku to block access to OCCRP’s website altogether. As usual, the report was slammed as “biased”, “ridiculous” and part of an orchestrated “smear” campaign organised by no other than the “Armenian lobby”, albeit with the help of British Intelligence and George Soros.
The Azerbaijani manat – money that gets about. After the OCCRP revealed information about Baku’s $2.8bn slush fund, the site was blocked across Azerbaijan. Photo courtesy of Photolia. Some rights reserved.
This kind of reaction isn’t surprising. After all, this time there is evidence of money being transferred directly to politicians and members of the European parliament who we know have played their part improving Azerbaijan’s image in Europe. It is these revelations that have pushed the European Parliament, PACE and politicians across Europe to condemn such acts of corruption, thoroughly investigate them and adopt measures to prevent their ever occurring again.
The timing is also important. On 7 September, three days after the breaking of the laundromat story, United States Senator Richard Durbin proposed sanctions against Azerbaijan.
What these latest revelations reveal is how Azerbaijani money has been used to buy favours and praise while playing down criticism. It also shows that rather than investing in long-term development of Azerbaijan, the country’s ruling elite prefers to invest in assets abroad. The corruption in my country is such that even the elite know that their property rights are respected only abroad, and that it’s only abroad that they don’t have to pay bribes to keep their businesses. They also know that no one will ask questions or hold them accountable for their actions at home. Or so they thought.
Earlier this year, Azerbaijan left the EITI (Extractive Industry Transparency Initiative) amid growing international criticism of crackdowns on dissent. For years, Azerbaijan had tried to push certain policymakers to see criticism of the country’s human rights record as not being theirs to make. Now that we know what we do about Azerbaijan’s lobbying onslaught, whose place is it to make that criticism?
As European politicians choose to look the other way, Azerbaijan is bringing its corruption onto their turf, undermining the very basis of their commitments to democracy
It’s up to you to peek behind Azerbaijan’s facades. Yes, Baku’s “business as usual” with large western energy firms breeds apologists for Azerbaijan’s regime overseas. But the west is not the only powerful actor in this relationship — governments in Europe and North America are themselves the targets of a concerted campaign of political influence, on which the Aliyev regime has lavished millions of dollars.
As European politicians choose to look the other way, Azerbaijan is bringing its corruption onto their turf, using their institutions and their citizens, undermining the very basis of their commitments to democracy.