Prosecutor’s Office Charges Giorgi Bachiashvili with Embezzling 39 Million Dollars from Bidzina Ivanishvili

At the trial held today in the Tbilisi City Court, the prosecutor's office requested bail be set at 3 million GEL for Bachiashvili. By the decision of Judge Tamar Mchedlishvili, the defendant was released on bail in the amount of 2.5 million GEL, was forbidden to leave the country without the consent from the prosecutor's office until the final ruling on the case was reached, and was ordered to hand over his Georgian and Russian passports to the investigation.

Giorgi Bachiashvili, who held the position of the executive director of the Co-Investment Fund from 2013-2019, pled not guilty.

“I am not guilty. I have never committed a crime and so it is unclear why I ended up in this trial. Aside from one person accusing me of something, there is no evidence in the case,” said Giorgi Bachiashvili.

The General Prosecutor's Office issued a statement today on the case of misappropriation of a large amount of cryptocurrency and legalization of illicit income. The agency referred to the accused by his initials and did not name the plaintiff investor by name. Only at the trial did it become clear that the plaintiff is Bidzina Ivanishvili.

“We are dealing with a simple case here - appropriation of cryptocurrency generated by investment and the subsequent legalization of these assets. The investigation started in March of this year when we received the information. The representative of the victim addressed us with the statement and naturally, as with any case and circumstance, we started an investigation,” said Mikheil Sadradze, the prosecutor of the case.

According to the case materials, in the summer of 2015, Giorgi Bachiashvili invested in the production/mining of cryptocurrency - Bitcoin, with the funds provided by the investor, i.e. Bidzina Ivanishvili, and managed by him personally. Bitcoin mining services were provided by a foreign company based on a 1-year contract signed in July 2015 with the enterprise owned by Bachiashvili. The value of the contract was determined at 6,305,000 US dollars, of which Bidzina Ivanishvili contributed 5,000,000 US dollars, and Giorgi Bachiashvili - 1,305,000 US dollars. Presumably, the accrued profit should have been distributed between the parties in proportion to the amounts invested.

“During the one-year period, 24,661.85 bitcoins were generated, of which, taking invested funds and incurred expenses into account, pure profit amounted to 8,253.13 bitcoins. In October 2017, the defendant, who had full custody and control of the full amount of cryptocurrency accrued as profit, paid out only USD 536,900 from the total profit to the investor, and appropriated the remaining 8,253.13 bitcoins rightfully belonging to the investor, the value of which, at the time of illegal possession was 39,215,820 US dollars,” the prosecutor's office says.

According to the prosecution, after embezzling the cryptocurrency, Giorgi Bachiashvili covered up the illegal origin of the seized assets and “laundered the illegally appropriated cryptocurrency – 8,253.13 bitcoins and the particularly large amount of funds obtained as a result”.

In response to the prosecutor's office, Giorgi Bachiashvili's lawyer, Levan Makharashvili, stated that the case includes a loan agreement signed between Cartu Bank and Bachiashvili's company, which proves that the company took a loan of 5 million, which was paid back a year later.

“An even bigger question is why the investigation started looking into this fact 8 years later, especially considering that during all these years Bachiashvili worked in leading positions in companies that were directly or indirectly linked to the plaintiff,” said the lawyer.

If Giorgi Bachiashvili is found guilty, he faces 9 to 12 years of imprisonment.