Guernsey Law Officers assisted the UK NCA in the first UWO, which involved a golf club in Ascot and a house in Knightsbridge.

On August 14^th, 2024, the Guernsey Law Officers of the Crown published the following news.

1. The Law Officers of the Crown are pleased to have actively supported the UK's National Crime Agency ("NCA") in its case against Zamira Hajiyeva by securing Production Orders against several Guernsey-based financial services institutions.
2. Material obtained under the Orders contributed towards the successful forfeiture of luxury properties, including a house in Knightsbridge valued at £14 million and a golf club in Ascot.
3. This case is of particular significance as Mrs Hajiyeva was the first person to be subject to an Unexplained Wealth Order, which the UK Government introduced to allow the tracing of potential proceeds of criminal conduct.
4. The Bailiwick of Guernsey's involvement in this case continues to demonstrate our commitment to tackling both domestic and international economic crime and the importance we place on working with our international partners.

The NCA's article on this case can be found here. https://www.nationalcrimeagency.gov.uk/news/luxury-properties-forfeited-after-six-year-nca-investigation - also read below

5 AUG 2024 - Luxury properties forfeited after a six-year NCA investigation

The wife of jailed banker Jahangir Hajiyev has agreed to forfeit a house in Knightsbridge worth approximately £14 million and a golf club in Ascot, following a National Crime Agency (NCA) civil recovery investigation into the acquisition of the properties.

The NCA believes the assets were obtained as a direct result of large-scale fraud and embezzlement, false accounting and money laundering.

In 2018, the NCA applied for unexplained wealth orders (UWOs) in relation to the two UK properties, as well as interim freezing orders to ensure that they could not be sold, transferred or dissipated. The UWOs were the first ever granted in the UK.

Hajiyev was the Chairman of the Board of the International Bank of Azerbaijan (IBA) until March 2015. The following year, he was convicted by a court in Azerbaijan of various offences, including misappropriation, abuse of office, fraud and embezzlement in connection with his tenure. In 2019, he was convicted of further embezzlement from the Moscow subsidiary bank of the IBA. He is currently serving a 16-year jail sentence in Baku.

NCA investigators subsequently identified numerous examples of funds derived from the IBA being transferred through multiple accounts in ways consistent with common money laundering practices. This was done by a close associate of Hajiyev, acting on his behalf.

Substantial sums were moved through a network of accounts and companies in a host of different jurisdictions – including the British Virgin Islands, Saint Kitts and Nevis, Panama, Cyprus and Luxembourg – and channelled into luxury assets for the family.

No reasonable explanation was provided to the NCA for the source of funds used to purchase either property. A significant proportion could be traced directly to sums generated by promissory notes and loan agreements used to conceal the theft of IBA monies.

The purchase of the golf club was conducted through a complex structure of Luxembourg and Guernsey-registered companies, and by using offshore trusts in Guernsey and later, Cyprus.

Virtually all of the funds used to purchase the Knightsbridge house are believed to have come from two specific IBA accounts.

They were directed to the UK by an associate of Hajiyev via bank accounts set up in Cyprus, Estonia and Switzerland in the names of companies with no recorded link to Mr Hajiyev. A British Virgin Islands company solely owned by the same associate was used to purchase the house, before the property was transferred into an offshore trust also set up in the British Virgin Islands.

In March 2021, the Agency applied for a property freezing order over the two properties.

In June 2023, the NCA filed a claim for civil recovery at the High Court.

On Thursday 1 August, the civil recovery order was granted, resulting in the forfeiture of 70% of the value of both properties.

While the Court has concluded that the properties were purchased as a result of criminal activity and are therefore recoverable, it has not made any finding in relation to Mrs Hajiyeva’s knowledge of how the properties were paid for.

Tim Quarrelle, Branch Commander for Asset Denial at the NCA, said:

“NCA officers worked tirelessly to track the complex movement of these funds across the international banking system, through shell companies in multiple jurisdictions, in order to ascertain their source.

“This result comes almost six and a half years after we served Mrs Hajiyeva with the first unexplained wealth order ever granted, and highlights our commitment to using all the tools at our disposal to combat the flow of illicit money into, and through, the UK.”

Simon Armstrong, Deputy Director, NCA Legal, said:

“The NCA’s investigation was followed by complex and lengthy litigation, which saw NCA lawyers address numerous challenges and use a range of legal powers introduced by the Criminal Finances Act 2017 to successfully recover assets worth millions of pounds.

“This fantastic result demonstrates how the NCA will deploy all the powers available to identify, pursue and recover the proceeds of crime.”

Source

5 Aug 2024 https://www.nationalcrimeagency.gov.uk/news/luxury-properties-forfeited-after-six-year-nca-investigation