Georgian Prosecutor’s Office investigates money laundering scheme involving TBC Bank

The Georgian Chief Prosecutor’s Office has stated that it started an investigation into money laundering involving TBC Bank in August 2018.

The office says that its Financial Monitoring Service launched a study of financial assets of TBC Bank, its client companies, bank administrators and particular shareholders in May 2018, which revealed that there were “signs of money laundering”.

The monitoring service then sent the materials to the National of Bank of Georgia and addressed the Prosecutor’s Office to take further steps.

We launched the investigation into money laundering on 2 August 2018. The case concerns developments in 2008, when LTD Samgori M and LTD Samgori Trade received a 17 million USD  loan in an accelerated manner from TBC Bank without providing any real estate,” the Prosecutor’s Office says.

The office reports that when the money was placed on the accounts of the companies, head of TBC Mamuka Khazaradze and another representative of the bank Badri Japaridze took the same amount of loan as physical entities from TBC.

The Prosecutor’s Office says that at the end of 2008, TBC, without providing any genuine reasons, wrote off the debt of the companies and in 2012 completely freed the companies from any financial obligations before the bank.

The Prosecutor’s Office says that Khazaradze and other individuals related to the case have already been questioned.

On 4 January 2019 we addressed the Tbilisi City Court for a permit to withdraw necessary documentation from the bank and the court has made the permission,” the Prosecutor’s Office says.

TBC bank says that it is a “deliberate discreditation” and it will use all levers to protect own interests.

The bank says that the investigation concerns an “ordinary banking operation” which has been several times checked by both the previous and current state authorities.

It is a legal banking operation which took place in 2008, which has been repeatedly reviewed by the Georgian state agencies and the National Bank of Georgia during both the previous and current governments and has been verified and confirmed by international auditors.

At the same time the transaction is outdated,” the bank says.

The bank statement reads that during its 27-year existence on the market, during all the state governments, TBC has many times been the “subject of attacks.”

The National Bank of Georgia says in its statement that the TBC bank is a “healthy credit organisation,” and claims that the ongoing investigation will not make any influence on the stable and effective activities of the Georgian banking sector.