ANTI CORRUPTION

The unsolved mystery of who owns Sherlock Holmes’s original £130 million home

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221b
Sherlock Holmes
Consulting detec­tive
1881–1904

So reads the blue plaque on this pret­ty Georgian ter­raced house, home to London’s Sherlock Holmes Museum. In a city of sto­ried build­ings, the home of the fic­tion­al detec­tive is as famous as they come. The muse­um is also not the orig­i­nal loca­tion of the fic­tion­al detective’s fic­tion­al house. If you’re fac­ing the muse­um and peer to the left, you’ll see an Art Deco clus­ter of flats and offices. This hous­es the orig­i­nal 221b Baker Street.

In the 21st cen­tu­ry, the orig­i­nal loca­tion has fall­en far off its pedestal as the home of Britain’s most famous gen­tle­man crime-fight­er. Instead, it now sym­bol­izes a very mod­ern London trait: the city as a mec­ca for mon­ey stashed away by the elites of cor­rupt coun­tries.

Valued at more than £130 mil­lion ($183 mil­lion), the prop­er­ty span­ning 215 to 237 Baker Street is held via a web of secre­tive off­shore cor­po­ra­tions which hide its owner’s iden­ti­ty. It is noto­ri­ous among anti-cor­rup­tion activists: In 2015, then-prime min­is­ter David Cameron sin­gled out alle­ga­tions about the prop­er­ty in a speech in Singapore, insist­ing, “We need to stop cor­rupt offi­cials or organ­ised crim­i­nals using anony­mous shell com­pa­nies to invest their ill-got­ten gains in London prop­er­ty.” Two years lat­er, the gov­ern­ment cit­ed the build­ings in its 2017–2022 Anti-Corruption Strategy (pdf, p.37).

Anti-cor­rup­tion orga­ni­za­tions have pre­vi­ous­ly inves­ti­gat­ed the prop­er­ties, and pos­tu­lat­ed pos­si­ble secret own­ers for them. Now, court doc­u­ments seen by Quartz and files leaked in the Panama Papers sug­gest the prop­er­ties have belonged at least in part to one or more fam­i­ly mem­bers of Kazakhstan’s pres­i­dent, Nursultan Nazarbayev.

The impen­e­tra­ble nature of off­shore secre­cy makes unrav­el­ling who exact­ly in the Nazarbayev cir­cle owns the build­ings a task wor­thy of Holmes him­self. But Quartz’s report­ing sug­gests that, among oth­ers, Nazarbayev’s grand­son Nurali Aliyev is tied to the prop­er­ty and his daugh­ter, Daria Nazarbayeva, also may be linked. Despite both hav­ing spent many years in gov­ern­ment jobs, both daugh­ter and grand­son have accrued hun­dreds of mil­lions in pri­vate wealth, accord­ing to Forbes Kazakhstan.

High-pro­file cas­es like Baker Street pose an impor­tant test of Britain’s com­mit­ment to bring trans­paren­cy to the own­er­ship and con­trol of com­pa­nies there. What bet­ter place to start than the mys­te­ri­ous orig­i­nal “home” of Sherlock Holmes?

In front of the Baker Street prop­er­ty. (Elizabeth Dalziel for Quartz)

A scandal near Belgravia?

Corruption is ram­pant in Kazakhstan. The for­mer Soviet coun­try, which has among the biggest oil and gas reserves in the world, ranks 122nd out of 180 coun­tries in Transparency International’s glob­al cor­rup­tion index.

It’s a big nation­al prob­lem,” says for­mer Kazakh prime min­is­ter Akezhan Kazhegeldin, who used to work under Nazarbayev and is now part of the oppo­si­tion in exile. “A small group of peo­ple took over con­trol of the coun­try, its law enforce­ment agen­cies, secu­ri­ty appa­ra­tus­es, and are using it as pro­tec­tion in their self-enrich­ment scheme.”

Meanwhile, coun­tries like the UK enable klep­to­crats from all around the world, by shel­ter­ing loot­ed cap­i­tal. “The UK and US are at the fore­front of pro­vid­ing inter­na­tion­al ser­vices” for the super-rich to “white­wash the trail of your illic­it pro­ceeds and…launder your own rep­u­ta­tion,” says Alexander Cooley, direc­tor of Columbia University’s Harriman Institute and co-author of Dictators Across Borders: Power and Money in Central Asia.

The Baker Street prop­er­ties have long seemed a part of this pat­tern. In 2015, a report by anti-cor­rup­tion orga­ni­za­tion Global Witness sug­gest­ed their own­er­ship was tied to Rakhat Aliyev the ex-son-in-law of the Kazakh pres­i­dent, and for­mer Kazakh secu­ri­ty deputy chief, who died in mys­te­ri­ous cir­cum­stances in an Austrian jail cell that same year. But lawyers at BCL Burton Copeland, which rep­re­sents the nom­i­nee direc­tor of the hold­ing com­pa­ny that owns the prop­er­ties, firm­ly denied that Rakhat Aliyev had ever been an own­er.

Could it instead belong to oth­er mem­bers of Aliyev’s fam­i­ly, such as his son Nurali or ex-wife Dariga?

This is the £130 mil­lion ques­tion,” says Tom Mayne, who co-researched Global Witness’s report on the prop­er­ties. “The com­pa­ny has ruled out Rakhat, so this leaves Nurali and Dariga,” he said. BCL Burton Copeland did not respond to Quartz’s inquiries about whether Aliyev’s ex-wife Dariga Nazarbayeva or son Nurali Aliyev had ever owned any por­tion of the prop­er­ties.

Nazarbayeva, a senior Kazakh sen­a­tor and for­mer deputy prime min­is­ter, has long been rumored to be in line to suc­ceed her father as Kazakhstan’s pres­i­dent. Her son, Nurali, for­mer deputy may­or of Astana, Kazakhstan’s cap­i­tal, has been the sub­ject of sim­i­lar suc­ces­sion rumors. Both are part of “a whole cat­e­go­ry of bil­lion­aires across Eurasia and the devel­op­ing world whose income ori­gins remain rel­a­tive­ly murky and unknown,” says Cooley.

It’s nor­mal­ly easy to find out the share­hold­ers of a fam­i­ly-owned com­pa­ny in Britain. UK-reg­is­tered com­pa­nies have to pub­licly list any­body who owns more than 25% of their shares as a per­son of sig­nif­i­cant con­trol (pdf, p.2). However, Farmont Baker Street, the pri­vate lim­it­ed com­pa­ny reg­is­tered as the own­er of the Baker Street build­ings, says in its cor­po­rate fil­ings that no one fits that descrip­tion in this case—which has kept the iden­ti­ty of its own­ers hid­den. If the paper­work was filled out cor­rect­ly, that would imply there are five or more own­ers who each own 24% or less of the com­pa­ny.

Mayne and Kazhegeldin say Nazarbayeva and Nurali’s ties to the build­ing should be inves­ti­gat­ed. “Any mon­ey from peo­ple relat­ed to inner cir­cle arriv­ing in the West—especially in the EU and UK—must be treat­ed as sus­pi­cious,” says Kazhegeldin. In 2016, inves­tiga­tive jour­nal­ism non-prof­it the OCCRP con­clud­ed from the Panama Papers that Nurali had stashed assets off­shore.

John Mann, a back­bench Labour MP who has long railed against off­shore mon­ey laun­der­ing, agrees that author­i­ties should inves­ti­gate the properties—and the mar­ket as a whole. “The gov­ern­ment need[s] to con­sid­er care­ful­ly how to clamp down on any abus­es, and use the full force of the law’s exist­ing pow­ers on mon­ey laun­der­ing and unex­plained wealth to find out what has real­ly been hap­pen­ing,” he said in a writ­ten state­ment.

To be clear, there is no evi­dence or alle­ga­tion that Nurali or Nazarbayeva has been involved in cor­rupt or ille­gal activ­i­ty, or that they have used illic­it funds to pur­chase the Baker Street prop­er­ties. But there is lit­tle ques­tion that both are fan­tas­ti­cal­ly wealthy: Forbes Kazakhstan con­sid­ers both of them to be worth hun­dreds of mil­lions, and ranked the moth­er and son as among the 50 rich­est Kazakhs in 2012 and 2013.

But what points to Nazarbayeva and Nurali as like­ly own­ers of the build­ing? That, dear read­er, is ele­men­tary.

The case of the unused yacht

In ear­ly 2008, things were look­ing pret­ty good for Nurali Aliyev. Then just 23, the Kazakh president’s grand­son was chair­man of Nurbank, one of the country’s biggest pri­vate banks. By the end of the year, he would be named deputy chair of the state-owned Development Bank of Kazakhstan. He lacked one thing though: a real­ly nice yacht.

So he bought one, named it “Nomad,” and insured it for €2 mil­lion, reportsinves­tiga­tive jour­nal­ism non-prof­it OCCRP. But the yacht was report­ed­ly dam­aged in bad weath­er, and Nurali seem­ing­ly nev­er got to use it, OCCRP reports, based on infor­ma­tion in the Panama Papers. Many of the rel­e­vant Panama Paper files, obtained by German news­pa­per Süddeutsche Zeitung and shared with the International Consortium of Investigative Journalists, were shared with Quartz.

Youyou Zhou

The yacht’s short life saw its own­er­ship pass through at least three hold­ing com­pa­nies in the British Virgin Islands (BVI). Owning assets through off­shore com­pa­nies pro­vides sev­er­al ben­e­fits for super-rich indi­vid­u­als from coun­tries with poten­tial­ly frag­ile polit­i­cal sys­tems. They hide the owner’s iden­ti­ty, make it dif­fi­cult for author­i­ties back home to seize the prop­er­ties (should pow­er ever change hands or the own­er fall out of favor), and hold­ing assets through the BVI can pro­vide tax ben­e­fits.

Nurali even­tu­al­ly sold the yacht back to its man­u­fac­tur­er in 2011 via BVI firm Greatex Trade & Investment Corp, accord­ing to OCCRP. In 2010–2011, that com­pa­ny was also the ulti­mate own­er of the UK com­pa­nies that owned the Baker Street prop­er­ties, accord­ing to com­pa­ny files.1

The UK com­pa­nies hold­ing the Baker Street prop­er­ties and the ones through which Nurali owned the yacht count­ed among their staff the same man: Mukhamed Ali Kurmanbayev, whose LinkedIn pro­file says he is a “spe­cial­ist in lux­u­ry assets—aircraft, yachts, real estate.”2

Kurmanbayev worked for Nurali as ear­ly as 2007 and appears reg­u­lar­ly in off­shore com­pa­nies linked to Nurali, the OCCRP reports. He was grant­ed pow­er of attor­ney(pdf) to sell Nurali’s yacht in July 2011. At the same time, he was also the sole nom­i­nee direc­tor of all three UK-reg­is­tered com­pa­nies that bought the Baker Street prop­er­ties. He held that posi­tion from 2010 to 2014 for all three com­pa­nies, and some for longer.3

The fact that Nurali’s yacht and the Baker Street prop­er­ties were ulti­mate­ly owned by the same BVI hold­ing com­pa­ny at the same time points to Nurali as the like­ly own­er of at least some por­tion of the prop­er­ties dur­ing at least 2010–2011. Nurali did not respond to requests for com­ment sent via his assis­tant and to his social media. Kurmanbayev’s lawyer didn’t respond to requests for com­ment.

UK-reg­is­tered Greatex also held the leas­es of two prop­er­ties near London’s Hyde Park, accord­ing to Global Witness, one of which was then sold to a com­pa­ny in the off­shore island tax haven of Jersey.

The adventure of the mysterious Italian

Kurmanbayev wasn’t the only nom­i­nee direc­tor of the Baker Street hold­ing com­pa­nies. Nor was he the only one con­nect­ed to Kazakhstan’s first fam­i­ly. In 2014, he was replaced by an Italian named Massimiliano Dall’Osso, who remains nom­i­nee direc­tor to this day.

Dall’Osso links Nurali’s moth­er, Dariga Nazarbayeva, to the Baker Street prop­er­ties.

Youyou Zhou

The 53-year-old Italian has a long and con­vo­lut­ed rela­tion­ship with Kazakhstan’s first fam­i­ly. In 2005, Dall’Osso became the man­ag­ing direc­tor of a German met­al­lur­gy com­pa­ny that belonged to Rakhat Aliyev (Nurali’s father and Nazarbayeva’s ex-hus­band) and his sec­ond wife, Elnara Shorazova, and was on the board of its Austrian par­ent com­pa­ny, accord­ing to court doc­u­ments seen by Quartz. Aliyev was ques­tioned in Malta in 2012 by Austrian pros­e­cu­tor Bettina Wallner, who was inves­ti­gat­ing alle­ga­tions made by the Kazakh state about Aliyev’s alleged role in the tor­ture and mur­der of two bankers in Kazakhstan in 2007.4 Dall’Osso’s lawyer didn’t respond to requests for com­ment.

While Aliyev and Dall’Osso seem to have part­ed ways by 2007, the Italian appar­ent­ly grew close to Aliyev’s ex-wife, Nazarbayeva. In the same inter­view, Aliyev told the pros­e­cu­tor that Dall’Osso now worked as a “per­son­al assis­tant” to Nazarbayeva.5

Christian Leskoschek, an Austrian lawyer who knew both Nazarbayeva and Rakhat Aliyev, con­firmed to the same pros­e­cu­tor in September 2012 that Nazarbayeva knew Dall’Osso—calling him an acquain­tance of hers. Nazarbayeva didn’t respond to requests for com­ment sent through her assis­tant and her par­lia­men­tary web­site. Leskoschek didn’t respond to requests for com­ment.

Dariga Nazarbayeva stands with her father, pres­i­dent Nursultan Nazarbayev, along­side Queen Elizabeth and Pr

A Study in Secrecy

The Baker Street case is a drop in the ocean of secre­tive London real estate. Around 86,000 British prop­er­ties have their ulti­mate own­ers hid­den by off­shore com­pa­nies, with Transparency International esti­mat­ing that £4.2 bil­lion worth of London real estate is owned by peo­ple whose wealth comes from sus­pi­cious sources. TI found in 2017 that 90% of prop­er­ties owned by “high cor­rup­tion risk indi­vid­u­als” were held by British Virgin Islands com­pa­nies.

The fic­tion­al hit BBC series McMafia—about a British-Russian mafia fam­i­ly liv­ing in London—has awak­ened the pub­lic to Britain’s role in inter­na­tion­al crime, and the British gov­ern­ment promised this year to step up its bat­tle against cor­rupt mon­ey.

Separately, a new law has just come into force, allow­ing author­i­ties to require a per­son to explain their stake in a prop­er­ty and how they came to own it, if they are sus­pect­ed of con­nec­tions to “seri­ous crime” and the owner’s income seems dis­pro­por­tion­ate to the property’s val­ue.

Authorities have already used this to tar­get two London homes worth a com­bined £22 mil­lion, report­ed­ly belong­ing (pay­wall) to a Central Asian politi­cian. “We will come for you, for your assets and we will make the envi­ron­ment you live in dif­fi­cult,” secu­ri­ty min­is­ter Ben Wallace has warned.

As is its pol­i­cy, the National Crime Agency declined to com­ment on whether there is or ever had been an inves­ti­ga­tion into the Baker Street prop­er­ties.

Tourists gath­er in front of the Sherlock Holmes muse­um. (Elizabeth Dalziel for Quartz)

The “great cesspool”

Britain’s per­mis­sive atti­tude to shady mon­ey hurts the coun­try in a pletho­ra of ways. It dimin­ish­es its soft pow­er, as Westminster preach­es trans­paren­cy abroad while let­ting mon­ey alleged­ly stolen by cor­rupt elites into its own mar­kets. It endan­gers nation­al secu­ri­ty, poten­tial­ly allow­ing for­eign pow­ers and ter­ror­ist orga­ni­za­tions to shov­el cash into Britain, with­out author­i­ties know­ing who’s behind it. And it makes British homes unaf­ford­able for nor­mal peo­ple, with hous­ing prices arti­fi­cial­ly juiced by oli­garchs safe­guard­ing mon­ey in emp­ty real estate.

Holmes’s side­kick Dr Watson described the British cap­i­tal as “that great cesspool into which all the loungers and idlers of the Empire are irre­sistibly drained.” Today, the city’s role as the end­point in the glob­al off­shore sys­tem drains mon­ey from devel­op­ing coun­tries, whose gov­ern­ments see mon­ey creamed from their bud­gets, only to reap­pear in London’s finest prop­er­ties.

Written by Max de Haldevang

The unsolved mys­tery of who owns Sherlock Holmes’s orig­i­nal £130 mil­lion home

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