Allegations of dodgy deals rock Council of Europe
Allegations of dodgy deals rock Council of Europe
It’s a money laundering scandal that has tainted one of Europe’s most venerable human rights organizations with allegations of shady money transfers, votes for cash and an autocratic regime buying favorable coverage.
And it’s unlikely to go away anytime soon.
Italian authorities are preparing to appeal a court decision to try a senior member of the Council of Europe on charges of money laundering but not on corruption.
A judge in Milan recently decided to try Luca Volontè, the former chair of the European People’s Party group in the Council of Europe and a former Italian MP, for money laundering. A court official last week said the Milan prosecutor’s office was “almost sure” about lodging an appeal because corruption was not added to the list of charges.
Volontè told POLITICO he awaits the money laundering trial “with confidence” but refused to answer any further questions.
In a report obtained by POLITICO, prosecutors allege that Volontè was paid almost €2.4 million by Azerbaijani officials in exchange for “his support of political positions of the state” at the Council, which also promotes democracy and rule of law.
The court hearing into the case, to take place in April, is likely to draw renewed attention to allegations of corruption and bribe-taking at an institution that has long sought to create better governance practices in countries such as Azerbaijan. The accusations of corruption have tainted the Strasbourg-based Council of Europe, a storied institution which counts Winston Churchill and Konrad Adenauer among its founding fathers. Not part of the EU system, its budget is mainly funded by contributions from its 47 member countries.
“The Council of Europe is the most important human rights institution in Europe, but in recent years it has been captured by autocrats,” said Gerald Knaus, the chairman of the European Stability Initiative (ESI), a think tank which for years has been critical of the Council.
In 2012, ESI published a report titled “Caviar Diplomacy, how Azerbaijan silenced the Council of Europe,” a title that referenced an interview with a senior Azerbaijani policymaker who said: “There are a lot of deputies in the Council of Europe Parliamentary Assembly whose first greeting, after ‘Hello’ is ‘Where is the caviar?’”
Human rights organizations and anti-corruption groups including Amnesty International and Transparency International have called for an independent investigation into suspicious money from Azerbaijan influencing decision-making.
Here is a breakdown of the case, based on information from the 50-page investigative report obtained by POLITICO:
Critical report voted down
In early 2013, the Council of Europe discussed a critical report concerning the treatment of political prisoners in Azerbaijan, presented by Christoph Straesser, a German Social Democrat member of the parliamentary assembly of the Council.
According to investigators, Volontè had been tasked by Azerbaijani officials to “direct votes within his parliamentary group” in favor of the country. He also sought the support of Spanish EPP member Pedro Agramunt to divide the socialist group and vote down the Straesser report. The report was eventually rejected by 125 to 79. The strong criticism on human rights in Azerbaijan, an oil-rich country classified as “not free” by the U.S-based democracy watchdog Freedom House, was then rejected.
A spokesperson for Agramunt rejected accusations of wrongdoing and downplayed the vote as “normal parliamentary activity.”
A few days after that vote, Volontè wrote an email, obtained by prosecutors, to an Azerbaijani politician, Elkhan Suleymanov, who also sits in the parliamentary assembly of the Council of Europe, in which, prosecutors say, he complained that the Azerbaijani official was not respecting their deal. “So, you have forgotten about me after your victory” to which the Azerbaijani official replied: “You will be forever my devoted friend.”
Two weeks later, Volontè received a contract for consultancy work that prosecutors say was provided to him by Azerbaijani officials to justify a €220,000 payment he received from them in December 2012 for his company L.G.V.
An investigation into the flow of money
The investigation began in 2013 after Volontè’s bank flagged “suspicious operations” to the Italian authorities. One of them was the €220,000 payment to Volontè’s L.G.V and there was another payment of €180,000
The first payment came via a Latvian bank from a company in the Marshall Islands, the second through an Estonian bank from a company seemingly based in the U.K., according to the document.
Volontè’s accountant later told prosecutors that the lawmaker had set up L.G.V in 2012 as he gave “political consultancies” to Suleymanov, the Azerbaijani politician.
Investigators say that money flowed from tax havens into Volontè’s accounts, including payments to a foundation he had established called the Novae Terrae Foundation, which received 18 payments of €105,000 each between July 2013 and December 2014 for a total of €1.89 million from two front Scottish companies. Investigators charge that Suleymanov was behind these payments.
Investigators also found a contract showing how “donors” committed to contributing a maximum of €1 million for nine years in exchange for annual reports of Novae Terrae Foundation activities.
Suleymanov did not respond to a request for comment.
In local media, however, he has rejected the accusations and complained about a “smear campaign against my country” that “was a part of a broad international conspiracy, organized by foreign corporate forces, to create unrests in order to destabilize Azerbaijan.”
An official at the Council stressed that the parliamentary assembly of the Council of Europe had already agreed to launch an independent external investigation and review its internal code of conduct.
A spokesperson said the Council’s secretary-general Thorbjørn Jagland “welcomes” this decision and that “he takes the allegations very seriously as they may impact on the whole organization.”
Volontè’s lawyer Domenico Pulitanò told POLITICO: “We have provided an explanation for the legitimate reasons why Volontè has received this money.” The money “was for cultural activities” and had “nothing to do with his functions in the Strasbourg assembly,” Pulitanò said.
Another lawyer for Volontè, Alessandro Pistochini, said the accusations of money laundering were “groundless since the documentation received from Azerbaijan’s general prosecutor shows that money received was not illicit” and that the companies used to pay Volontè “had been used many other times for legal commercial deals with Italian citizens without any accusation.”
Source: Politico; Written by: Jacopo Barigazzi