UK MP Hid His Role at Company Run by Controversial Azeri Businessman
While sitting on the U.K. Parliament’s defense committee, Conservative Party MP Bob Stewart failed to disclose his directorship at a foreign defense company owned by a controversial Azerbaijani businessman, a new investigation published on Wednesday shows.
In a collaboration with OCCRP, openDemocracy found that the Tory MP neglected his obligation to declare his position at the Luxembourg-registered firm Ksantex S.a.r.l., a provider of defense equipment and advice.
The company is owned by the controversial French-Azerbaijani businessman Khagani Bashirov, who served time in jail from 2010 to 2011 in relation to the disappearance of US$109 million in funds from the International Bank of Azerbaijan (IBA), according to an investigation by Radio Liberty’s Azeri service.
In his response to openDemocracy, Bashirov confirmed his time in jail but added he cooperated with the Azerbaijani authorities.
“My criminal record is clean everywhere. It is provable,” he said.
U.K. parliamentary rules require MPs to declare all relevant outside interests and benefits that could potentially influence their actions or words within one month of election as well as any changes to those interests within 28 days.
Stewart did neither.
According to the investigation, the Tory MP was a director of Ksantex between February 2015 and July 2017, during which time he was also a member of the House of Commons defense select committee, which has been tasked to oversee the work of government on defense issues.
Speaking to openDemocracy, Tommy Sheppard, a Scottish National Party MP and constitutional affairs spokesperson, said Stewart’s failure to declare his employment may be considered a “clear and serious breach of parliamentary rules. As an MP, [Stewart] should have declared this position even if unpaid. As an MP on the Defense Committee, the omission is even worse.”
When approached by reporters, Stewart explained that he had previously registered his interest with a “group of companies” back in 2012.
That year, he declared his interest in another company, VES Consultancy (U.K.), which was owned by Khagani Bashirov and was dissolved last year. The MP claimed to have earned 3,000 pounds per month for the “provision of leadership/planning training and advice.”
His entry in the register says the work lasted for one year from July 1, 2010. Corporate filings show it was a dormant company during that period. Both Bashirov and Stewart described it as a “start up”. It’s unclear how Stewart was paid.
Commenting publicly for the first time, Bashirov confirmed that he controlled and owned both VES Consultancy (U.K.) and Ksantex.
The company didn’t have any obvious corporate links to Ksantex SARL, so it was initially unclear why Stewart called them part of a “group of companies”.
Bashirov’s time in jail in Azerbaijan in relation to the IBA funds overlapped with the period Stewart first worked for VES Consultancy in the U.K. Stewart also confirmed that he had met Bashirov during this time.
“I believe I met him socially twice during my consultancy and we certainly did not discuss business,” the MP said.
Bashirov also said he met Stewart “once or twice” and hired him to help with his consultancy.
“I wanted to start providing economic consultancy services to my clients, and the presence of such a consultant could be a great help to me,” he told openDemocracy.
It’s unclear if Stewart was paid by Ksantex. When he was asked if his remuneration stopped in 2011, or if he was subsequently paid by Ksantex, he said he was not sure.
“I think my remuneration lasted for two years but then they had no further need of me,” he explained.
Stewart also added that he had no knowledge of Bashirov’s ownership of VES or his links to Ksantex and claimed he would have declined the consultancy if he had known and been aware of Bashirov’s jail time.
He said his role at Ksantex “was actually a consultant/non-executive director.”
“I advised on business leadership/planning based on my 2009 book ‘Leadership under Pressure’ which was all about business,” Steward added. “But I was not in any way involved in running the company or any decisions it made. I was totally unsighted on decision-making.”
The Tory MP also said he didn’t know that Ksantex was involved in defense work, claiming that at the time he believed the business of the group was about construction and in no way defense-related.
The company currently describes itself as a “boutique consultancy firm.”
However, at the time Stewart was director, it explicitly offered a “wide range of technologies, tactical equipment and services.”
In 2016, the company website listed selected tactical equipment, encrypted technology, recording systems and UAVs (drones) among the products it sold, naming several brands and manufacturers it worked with.
Despite the information on the website, Bashirov said Ksantex had never sold or bought military equipment but is “a consulting company in the field of civil and military radars.” He also confirmed that Stewart had been registered in Luxembourg as a non-executive director of the company.
In 2018, Bashirov was also mentioned during the U.K.’s Unexplained Wealth Order proceedings against the wife of the former chairman of the state-owned IBA, Jahangir Hajiyev. In these proceedings, he was named as being connected to Hajiyev, who was sentenced to 15 years in prison in 2016 for embezzlement and abuse of office.
In his response, Bashirov said his relationship with Hajiyev had soured because he had worked with the authorities in Azerbaijan to return bank assets to the state.
“Our relationship started to deteriorate in early 2013 and totally ended in November 2015,” he said. “He told me that I had betrayed him.”