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A British businessman and top donor to the United Kingdom’s ruling Conservative Party received tens of millions of dollars through a web of bank accounts and legal entities now known as the “Azerbaijani Laundromat,” court records fully released Monday show.

Javad Marandi, an Iranian-born retail and property magnate who moved to the U.K. with his family in 1979, lost a legal bid in March to block news outlets from naming him in connection with the National Crime Agency’s court-authorized seizure of £5.6 million from relatives of Javanshir Feyziyev, an Azeri lawmaker and businessman, in January 2022.

As a result, ACAMS moneylaundering.com can now report that banking and transactional records used by the NCA in those proceedings show that Marandi, 55, who has denied any wrongdoing, held stakes in several offshore companies featured in the Azerbaijani Laundromat, shared financial interests with Feyziyev and also benefited from the scheme.

Westminster Magistrates’ Court heard during the NCA’s civil asset forfeiture case against Feyziyev’s wife, son and nephew that the Azerbaijani Laundromat ran from 2012 to at least 2017 and relied on four U.K. shell companies: Polux Management, Hilux Services, Metastar Invest and LCM Alliance.

The NCA discovered that the four U.K. firms together received at least $1.4 billion from Baktelekom MMC, a “clone company” formed in Azerbaijan in 2012 with a name similar to Baktelecom, a legitimate telecommunications exchange headquartered in Baku.

Each of the four U.K. companies held accounts at Danske Bank’s affiliate in Estonia, which closed shop in 2019 after admitting to handling more than €200 billion in suspicious funds for non-resident legal entities from 2007 to 2015.

Hilux and Polux transferred tens of millions of dollars to Avromed Company and Avromed LLP, apparent shell companies with names apparently chosen to associate them with AvroMed, a legitimate Azerbaijani pharmaceutical firm in which Feyziyev held shares from 2007 to 2016. Records indicate that Marandi also held a stake in AvroMed until 2017.

The court heard in November that Avromed Company was formed in the Seychelles in 2005, received tens of millions of dollars into an account at Latvia’s now-defunct ABLV Bank and was beneficially owned by Marandi.

Bank records cited by the NCA during the asset forfeiture case show that Avromed Company paid more than $34 million to Javanshir Feyziyev from 2005 to 2016, but also transferred almost $49 million to Marandi and a further $106 million to an account held by Vynehill Enterprises, an offshore entity beneficially owned by the property developer.

According to the NCA, some of the payments were vaguely described as “account replenishment.” Others bore references to goods and services but lacked any apparent commercial rationale.

“The overwhelming implication is that these payments were not made pursuant to genuine contracts, but the description was a cover to deceive the bank and conceal the fact that they were simply payments made for [Marandi’s] benefit,” attorney Collingwood Thompson QC argued on behalf of the NCA. “If so, then Avromed (Seychelles) was simply used as a front company for the purposes of money laundering.”

The records also show the NCA linking Marandi to another shell company involved in the Azerbaijani Laundromat, Nevis-based Brightmax Export Limited, which also held an account at ABLV. Hilux, one of the four U.K. legal entities, paid more than $24 million into the account from November 2014 and May 2015 by way of bogus invoices.

The NCA claimed Marandi received $23 million from Brightmax, and that Feyziyev allegedly received $3.4 million.

Moreover, the £1 million seized in January 2022 from Feyziyev’s son’s account at the London wealth management firm Rathbones in January included onward payments by Feyziyev, most of which traced back to Brightmax “via the medium” of Marandi, District Judge John Zani ruled that month.

The NCA appeared to identify Mirandi as the beneficial owner of Brightmax but admitted that his name does not appear on any official corporate documents.

Open justice

Records from the U.K. Electoral Commission show that Marandi donated more than £660,000 to the Conservative Party from 2014 to 2020, a period that overlaps with the Azerbaijani Laundromat by at least three years.

An article run by the Sunday Times in February 2022 identified Marandi, who in 2019 received the Order of the British Empire for his services to business and philanthropy, as one of several wealthy Conservative Party donors who enjoyed privileged access to then-Prime Minister Boris Johnson, cabinet ministers and top government aides.

In October 2021, Judge Zani, then presiding over the asset-forfeiture case against Feyziyev’s relatives, barred moneylaundering.com and other news outlets from naming Marandi in their coverage of the proceedings after the businessman’s attorneys argued that publicly linking him to legal proceedings that did not directly involve him would violate his privacy.

Marandi’s attorneys sought to counter a challenge by the BBC and London Evening Standard against the ban by arguing that he held only a “peripheral” part in the proceedings, that the NCA had neither questioned him nor said he is under investigation, and that only in the case of the £1 million seized from Feyziyev’s son did an “express reference” to him appear in relation to seizable assets.

Publicly linking him to the proceedings would also have “serious repercussions” for his businesses by threatening his access to financial services in Britain, they claimed.

But Zani agreed to lift the ban in May 2022 after finding that Marandi did in fact qualify as “a person of importance to the main proceedings” and noting that his attorneys failed to provide enough evidence to support their argument that public knowledge of his apparent links to the scheme would impact him commercially.

Marandi then successfully applied for a judicial review of that decision. In March, the High Court in London rejected his claim that Zani’s decision to lift the reporting restrictions was flawed.

Lord Justice Mark Warby and Mr. Justice Nicholas Mostyn also criticized the “strategic decision” by Marandi’s attorneys to give the NCA and news outlets less than a day’s notice of their intention to apply for reporting restrictions back in October 2021, as well as the procedural circumstances under which Judge Zani had made the order.

“In my judgment, for reasons of procedural unfairness as well as a distinct lack of merit, it should never have been granted,” Mr. Justice Mostyn ruled on March 17. The Court of Appeal refused Marandi’s attorneys permission to appeal the ruling on Monday, ending the 19-month legal battle to stop news outlets from naming their client in connection with the money laundering case.

In an earlier court filing supporting the original application for a reporting embargo, attorneys for Marandi said the entrepreneur has “substantial” and entirely legitimate business interests in both Britain and Azerbaijan, including through Avromed until 2017.

As for the transactions that linked Marandi to the alleged money-laundering scheme, his attorneys claimed that Azerbaijan had imposed tighter currency controls at the time but allowed individuals to use “exchange houses” in Latvia and Estonia to transfer wealth abroad.

“This exit route was used … to transfer legitimately owned dividends from Avromed and his other legitimate business interests in Azerbaijan to Switzerland,” his attorneys argued. “The funds were lawfully earned, and lawfully transferred, and there is no question of money laundering.”

In a statement Monday, Marandi’s attorneys again denied any wrongdoing by their client.

“JM [Javad Marandi] was solely an investor in the business and had no day-to-day involvement in running or dealing with the financial affairs of the company [Avromed],” attorneys for the businessman told moneylaundering.com. “At no point has Mr. Marandi been investigated or questioned by the authorities … and no case has ever been brought against him or his businesses in relation to these or any other matters, anywhere in the world.”

Contact Koos Couvée at kcouvee@acams.org