British Lawyer Fined for Negligence Over Azerbaijani Ex-Minister’s Family Property Deal

A UK lawyer has been fined £32,500 and banned from holding key legal roles for five years after failing to properly vet millions of pounds linked to the family of Eldar Mahmudov, Azerbaijan’s former National Security Minister. The funds were used to purchase commercial property in southern England via offshore companies, exposing gaps in the UK’s legal oversight and transparency mechanisms.

Eldar Mahmudov served as Azerbaijan’s Minister of National Security until his dismissal by presidential decree in October 2015. His family has since been the subject of numerous investigations revealing an extensive business and real estate empire in Europe worth at least €100 million. Despite these inquiries, some property acquisitions linked to the family have remained obscure, shielded by offshore entities and legal loopholes in UK property law.

According to a recent ruling by the UK’s Solicitors Disciplinary Tribunal (SDT), lawyer Rory Fordyce was penalised for “rudimentary, piecemeal, and naive” vetting of funds he handled between 2013 and 2015. The tribunal found that Fordyce accepted two large transfers from members of the Mahmudov family into a client account at Taylor Fordyce, the law firm where he was a director.

The most notable transfer, approximately £1.9 million (about $2.5 million), was made in April 2015 and subsequently used to purchase commercial real estate in Newbury, southern England. The purchase was carried out by Continental Properties Limited, an offshore company registered in St. Kitts and Nevis, with its address listed “care of” the Taylor Fordyce law firm shortly after the transaction.

The Newbury property includes several commercial units, such as a Pizza Hut outlet, a tutoring centre, a Greggs bakery, and a Salvation Army donation store. Despite its commercial nature, the ultimate beneficial owners of Continental Properties remain undisclosed publicly due to UK laws exempting trust-managed companies from ownership transparency.

The tribunal’s decision emphasised Fordyce’s failure to seek sufficient information, stating:“Mr. Fordyce proceeded with the transaction despite knowing that more information was needed, prioritising the deal over his regulatory obligations.”

Fordyce told authorities that Continental Properties was ultimately owned by Continental Trust, allegedly created by Anar Mahmudov, Eldar Mahmudov’s 41-year-old son. However, the tribunal found that Anar Mahmudov was neither a director, shareholder, nor beneficial owner of the company and was removed from the beneficiaries list alongside his wife. The funds were ultimately traced back to Nargiz Mahmudova, Anar’s sister.

Helen Taylor, deputy director of the anti-corruption group behind the Organised Crime and Corruption Reporting Project (OCCRP), commented that the case highlights the urgent need for investigation:“This incident, especially given several scandals involving Azerbaijani-linked UK real estate, shows how these funds must be urgently scrutinised.”

She also noted the risks faced by small legal firms that may fail to ask detailed questions of their clients, leaving them vulnerable to regulatory breaches.

The ruling against Fordyce exposes weaknesses in UK legal oversight, particularly concerning the purchase of high-value real estate by politically exposed persons via offshore structures. The 2020 OCCRP and Finance Uncovered joint investigation had already revealed that the Mahmudov family’s European business and property empire was worth at least €100 million, though the Newbury property and Continental Properties were not referenced at that time.

Following Eldar Mahmudov’s dismissal in 2015 and the subsequent dismantling of Azerbaijan’s Ministry of National Security, several ministry officials were prosecuted and assets confiscated, underscoring the turbulent political backdrop to these financial affairs.

The disciplinary sanctions against Rory Fordyce—comprising a £32,500 fine, a five-year ban from legal management roles, and £50,000 in legal costs—serve as a cautionary tale of the consequences of inadequate due diligence. Yet the true extent of ownership and accountability surrounding the Newbury commercial property remains obscured.

This case underscores the pressing need for enhanced transparency and regulatory vigilance in the UK property market, especially concerning assets linked to foreign politically exposed individuals, to prevent misuse of the system and protect the integrity of the real estate sector.