Andrew Mountbatten-Windsor received millions of pounds from an oligarch using funds from a firm implicated in criminal corruption, a BBC investigation has found.
Kazakh billionaire Timur Kulibayev has told the BBC through his lawyers that he used a loan from a company called Enviro Pacific Investments to help him buy Andrew’s former mansion.
Prosecutors in Italy concluded that the firm had received cash from a bribery scheme in 2007.
Weeks after the last of these payments was made, the oligarch bought Sunninghill Park in Berkshire from the then prince for £15m – with the help of funds from Enviro Pacific.
Kulibayev is the son-in-law of Kazakhstan’s then-president and was one of the most influential officials in the central Asian country’s oil and gas industry. The BBC has also learned that, in another case, an Italian businessman pleaded guilty to bribing the oligarch.
Kulibayev’s lawyers told us he has never engaged in bribery or corruption, and the funds used to acquire Sunninghill Park were entirely legitimate.
The revelations raise questions about whether the then-prince may have inadvertently benefited from the proceeds of crime and whether he and his advisers conducted the proper checks required by law to avoid this.
Money laundering expert Tom Keatinge, director of the Centre for Finance and Security, said the deal had “blatant red flags” which should have prompted detailed checks to ensure it was not “helping to launder the proceeds of corruption”.
Kulibayev reportedly paid £3m more than the asking price and an estimated £7m more than the property’s market value.
The former prince did not respond to the BBC’s requests for comment. He told the Daily Telegraph in 2009, after criticism of the deal: “It’s not my business, the second the price is paid. If that is the offer, I’m not going to look a gift horse in the mouth and suggest they have overpaid me.”
On the market
Sunninghill Park was given to Andrew by the Queen as a wedding gift in 1986. A modern two-storey red-brick mansion, the 12-bedroom house, with 12 matching bathrooms and six reception rooms, was mocked for its resemblance to a Tesco superstore.
After it was first put on the market in 2001 and failed to attract offers, Andrew became personally involved. The former prince used the opportunity of an official visit to Bahrain as the UK’s trade envoy in 2003 to personally try to sell the property to Gulf royals, according to Simon Wilson, who was deputy ambassador at the time.
But a buyer eventually emerged through the then prince’s connections to a different country: Kazakhstan. In 2002, Andrew had become patron of the British-Kazakh Society jointly with the country’s autocratic president Nursultan Nazarbayev. Andrew visited the country in 2006 and, later that year, Nazarbayev met the then Queen at Buckingham Palace.
In 2007, an offer for Sunninghill Park came from Timur Kulibayev, Nazarbayev’s son-in-law.
At the time, he had a fortune estimated at more than £1bn and a key role running the country’s sovereign wealth fund, Samruk-Kaznya, which owns much of the state’s oil and gas industry.
Andrew had reportedly been introduced to Kulibayev by Kazakh businesswoman and socialite Goga Ashkenazi, who has two children from an affair with the oligarch. She later described the prince as a close friend, but now says she has not had any dealings with him for about 15 years.
Andrew and Ashkenazi were photographed in June 2007 attending Ladies Day at Ascot with the Queen. In the same month, contracts were exchanged for the purchase of Sunninghill. Kulibayev used an offshore company he owned, Unity Assets Corporation, to buy the mansion. The Royal Family’s solicitors, Farrer & Co, acted for the seller.
The transaction was completed in September that year. The same month, royal records show, British taxpayers picked up a bill for £57,000 for a chartered flight for the former prince to visit Kazakhstan on official business as trade envoy.
At the time of the sale, the UK government was raising concerns about Kazakhstan. Then-Europe Minister Geoff Hoon told MPs in April 2007 that “allegations of systematic corruption” in the country were “rife”.
Despite these concerns – as well as Andrew’s official role as trade envoy and his position then as fourth-in-line to the throne – the identity of the buyer was not disclosed by either of the parties, or by Buckingham Palace.
In 2007, there was no requirement to identify the owners of offshore companies which bought UK property, and Kulibayev was only named by the media three years later.
Links to corruption
Questions were raised about the deal’s links to corruption in 2012, when media reports said Italian prosecutors were investigating allegations involving Kulibayev.
The allegations included the possibility that bribes might have been used to fund the purchase of Sunninghill Park through Enviro Pacific Investments – the company which has now been confirmed as partly funding the deal. These investigations did not lead to any charges against Kulibayev.
However, the BBC has seen documents from a series of court cases in 2016 and 2017 which together show how Italian prosecutors concluded that Enviro Pacific Investments had received cash from a bribery scheme.
These documents were first obtained by L’Espresso magazine during the International Consortium of Investigative Journalists’ Caspian Cabals project.
They suggest that Enviro Pacific Investments’ link to corruption was through another company called Aventall. In a case in Monza, Italian oil executive Agostino Bianchi pleaded guilty to paying bribes to Kulibayev and other Kazakh officials over lucrative oil contracts, and Aventall was named as one of the companies used to channel bribes. Kulibayev was not charged.
ShutterstockAccording to Bianchi’s plea agreement, Aventall was run by Massimo Guidotti, who was described as the “mediator” of corruption.
He had created a rating system measuring the influence of Kazakh oligarchs, according to court documents in a related case. In an email from 2009, he gave Kulibayev the maximum five stars. Questioned by prosecutors, Guidotti denied distributing bribes.
In a second case in Milan, prosecutors said Aventall had made payments “of an allegedly corrupt nature” to Enviro Pacific Investments – the company which lent the money for the Sunninghill purchase.
They said $6.5m (£3.27m) had been promised, but they could only find evidence of $1.5m (£755,000) of payments. The last was in April 2007, less than two months before contracts were exchanged for Sunninghill.
The prosecutors said “open sources” showed that Enviro Pacific was linked to Kulibayev. But the Milan proceedings were dismissed in January 2017 – in part because prosecutors could not link the payments to specific contracts or definitively identify the public officials who received the funds.
