Rakhat Aliyev’s Vienna’s media centre St. Marx: a money laundering showcase/I

Vienna seems to be in for a money laundering deal in broad daylight in front of the public eye. Dubbed St. Marx or MQM, the media centre in the city’s heart has been almost fully occupied for years by some 40 media enterprises employing over a thousand, the property has now been put on sale. The majority owner (by proxy) is no one less than Rakhat Aliyev, one of Kazakhstan’s most wanted criminals accused of multiple murder, torture, kidnapping, conspiracy, extortion and theft – just to mention part of a long list of charges for which he has been convicted in two separate trials to 40 years in prison in all. If the sale goes through, Austria is set to witness a likely sum of well over 50 million euro being whitewashed with full cooperation of the Viennese authorities. It looks hard to understand how on earth such a thing can ever happen, but Aliyev’s secret appears to be painfully plain: friends in high places. The ambiguous attitude the latter impose on Austria’s course of justice (or rather the lack of it) has provoked indignation both inside and outside the country, with calls for supranational intervention getting louder by the week.

BY CHARLES VAN DER LEEUW, WRITER, NEWS ANALYST

Rakhat Aliyev’s Vienna’s media centre St. Marx: a money laundering showcase/IPerhaps not the largest, but certainly the most prominently highlighted money laundering operation involving Aliyev and associates today concerns a multimedia centre downtown the Austrian capital known as St. Marx, located at the site of the same name where there used to be a major-size slaughtering and butchery complex. While 40 per cent of the Media Quarter Marx (MQM) holding that owns the property belongs to the City of Vienna through the public-owned firm Technologieagentur ZIT, the remaining 60 per cent is being held by VBM Beteiligungsmanagement GmbH, in turn owned by Maximus Holding, headed by Mrs. Shorazova, Aliyev’s current spouse whose surname he is using as his own, and which has invested 6.9 million euro in the project, with €4.56 in investments having come from public funds, and up to €63 million having been provided through a credit from Bank Austria.

Exactly where the liabilities for the bank loan lie remains unclear. But in mid-January this year, both owners announced that MQM is about to be put on sale. Not for the first time for all it matters. “VBM has tried in vain for two years already to find a buyer for is share in MQM,” a local periodical called Solidbau (http://www.solidbau.at/home/artikel/Immobilien_Wien/Media_Quarter_Marx_Rakhat_Aliyev_will_jetzt_doch_verkaufen/aid/22051?analytics_from=rss) wrote on January 7 this year. “An option to purchase the city’s share which expired as of end-December 2013 has remained unused. Now, ZIT and VBM’s management are jointly trying to find an investor. […] Institutional investors such as banks, insurance companies and property funds are being tipped as buyers.”

The article further quotes Gerhard Hirczi, director of the Vienna Trade Agency which is in charge of sales and purchases of public assets, as promising “a transparent procedure fully open to scrutiny”. But the official refused to mention either a sale time line or a starting offering price, and only stated that he was “optimistic” in terms of “project fair valuation”. “Possibly the trees do not grow into heaven, but a satisfactory valuation should be feasible,” Hirczi was quoted as observing. Whatever the case, this in practice means that the Agency will be helping not just to launder a notorious criminal’s ill-gotten gains, but even help him to make an impressive profit onit.

As reported earlier, between 2006 and 2009 in the order of at least a hundred million euro was pumped by Rakhat Aliyev into a network of investment targets in Austria, Switzerland and Germany. The input instruments were two firms based on the British Virgin Islands. According to Tagdyr, the pressure group of the two widows of the bankers murdered by Aliyev and associates in Almaty at the time and their lawyer, (www.tagdyr.net) the first one, A.V. Maximus SA’s BVI affiliate, received 24.8 million euro and 91.4 million US dollar from personal accounts of Aliyev while the second one, Agrocom, received 15.6 million euro. The money was subsequently transferred to A.V. Maximus’ parent company, which let it float into a range of companies in the form of in themselves legal investments. From there, the cash was wired back to the accounts A.V. Maximus (Austria) which posted it as return on investments which enabled it to wire it “legally” to A & P Power Ltd. on Malta which in turn transferred it to A & P Power Holding Ltd. on Nevis. But in spite of having moved his capital base abroad, it is in Vienna where Aliyev kept his cash-generating machinery in place – well protected by friends of old in high places.

Aliyev’s Maximus Holding had been founded on August 3, 2004 under the name Schwarcz & Co, with the address Schellinggasse 7, Vienna. On March 21, 2007, the name was changed into A.V. Maximus Holding AG – soon after which it started moving frequently from one address downtown the capital to the other. Its main activity was posted as “real estate property and management”. But there was more to it, for the enterprise controlled several other companies including a movie and television programme production firm called Speedy-Funk, a company called Armoreal Trading GmbH, an asset management firm called ASTA GmbH, and a non-profit foundation called Global Sugar Privatstiftung, according to an Austrian directory called BusinessABC.

Even though behind the entire conglomerate there was little more but Rakhat Aliyev, the chairman of the board of A.V. Maximus was a certain Christian Leskoschek, about whom little else ever became known. A lot more, however, was to become known of the holding’s president of the board administrators – for Adolf Wala was no one less than the former director-general of the National Bank of Austria, a post he had held between 1988 and 1998, after which he became its president until he retired in 2003. Retired? Two most revealing articles in Austria’s leading daily Der Standard dated July 26 and July 31 2009 were to tell a most fascinating story. Not only did Wala hold the post of managing director of ASTA, in which he owned 90 per cent with the remaining 10 per cent in the hands of Aliyev’s A.V. Maximus. He also remained in control of OeNB Immo-Gesellschaft which he had founded back in time. In 2007, he helped A.V. Maximus to establish a new real estate company under the name Howa Projectentwicklung GmbH, under nominal director of a lawyer named Peter Jandl. Even long before Schwartz & Co changed its name and started to move to new premises time and again, trouble rose as well, BusinessABC was to report.

Should Aliyev have used the option to buy his public partner out before the end of last year, he could have laundered some extra millions in the process. Since the municipality of Vienna maintains a policy of holding states in non-functional assets only temporarily and with the aim to privatize them, ZIT is committed to sell its stake in MQM, with the majority shareholder maintaining the right to purchase the stake at nominal value, in this case 5.2 million euro. This would have enabled Aliyev to pocket an extra €10 million or more in the form of the difference between nominal value and market sales value, according to an article in Die Wiener Zeitung (http://www.wienerzeitung.at/meinungen/analysen/598927_Media-Quarter-gut-alles-gut.html) published on January 18.

So why did Aliyev waive the option? The answer to that question looks rather obvious. If fully in private hands, MQM would have been exposed to investigations and eventual seizure by receivers on the order of a court of law – as has happened with Mukhtar Ablyazov’s assets in England. By hiding behind the city of Vienna, such proceedings appear to be blocked, giving one of Aliyev’s “friends” on the spot the perfect excuse to refrain from action. Such friends of old include the culprit’s former lawyer Wolfgang Brandstetter, who back in 2007 not just provided Aliyev, after the latter’s brief detention while trying to enter Austria illegally since his diplomatic passport had been withdrawn, with a residence permit and an Austrian passport for foreigners within days rather than through the normal multi-month scrutiny procedures, but also gave him shelter in his private home. Guess what – today Brandstetter is Austria’s minister of justice and thereby in charge of investigations against Aliyev. If this does not look like charging General Mladič with investigations into his own war crimes, it is hard to say what does…

The overall deadlock leaves a lot to be guessed even up to this very day. Ever since the very beginning of the controversy surrounding Rakhat Aliyev and his associates in Austria and elsewhere in Europe, the main question has remained why all the actions taken against Aliyev both before and after his downfall had any apparent effect in relation to the charges brought agains him and his enterprises. Well into the year 2012, angry Austrian MPs kept firing questions in Parliament to the ministers of justice and interior affairs at the time along with other state officials why all these interventions had remained without any consequences. So far, no satisfactory answers would appear to have been given.

Meanwhile, as the list of countries pointing at Aliyev’s dealings is growing and each country’s authorities seem to wait for each other country’s authorities to take action, calls for international coordination to bring the culprit to justice are getting more and more urging as well. “Portuguese member of the European Parliament Ana Gomes has called the European Commission to get Eurojust and Europol to investigate Rakhat Aliyev,” Tengrinews reported on January 9 this year (http://en.tengrinews.kz/crime/Eurojust-and-Europol-called-to-investigate-Aliyev-25129/). “According to Ana Gomes, considering the scale of allegations against Rakhat Aliyev in a range of countries, the European Union can’t step aside. ‘Based on the information available, the scale of the white collar crimes of which Mr. Aliyev is accused means that this is a matter for the EU, as well as for the national authorities. Legal proceedings which have been ongoing for a number of years at national level could already have been completed and brought to court by now,’ Ana Gomes said.”

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