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Georgian authorities accuse opposition movement of fraud

by | Jan 27, 2012

Zakaria Kutsnashvili, lawyer for Georgian Dream, says Georgian authorities have committed several violations by their fraud allegations, but for the time being the movement he represents is complying in order to avoid that their property is confiscated.

TBILISI, DFWatch – Georgian authorities accuse the opposition movement of billionaire Bidzina Ivanishvili of making a fraudulent business deal.

The claim is put forth in a statement posted on the web pages of the Chamber of Control’s financial monitoring unit, signed by its head Natia Mogeladze.

Her unit has been controlling Mr Ivanishvili’s movement since the start of January, following a change in the law which made the same rules that regulate party financing also apply to private companies, organizations and even individuals, if they have a stated aim of affecting the political process.

Many commentators and groups opposed these changes, because the constitution says that the Chamber of Control only has a right to monitor publicly financed organizations and doesn’t have a right to impose sanctions. The new law gave the CoC power to monitor organizations that are not publicly financed and to impose sanctions, including sequestration. Only courts and the revenue service had this prerogative before, though only in certain cases.

Despite that it seems to violate the constitution, the government approved these changes and after the CoC established a financial monitoring group it put the financial transactions of Georgian Dream under its looking-glass.

Georgian Dream is a so-called ‘public movement’, which means it’s a legally defined form of organization. It hasn’t set out any clear political goals yet, but still attracted the control body’s attention, which is not unexpected considering the declarations of billionaire Bidzina Ivanishvili about going into politics and removing president Saakashvili from power.

The newly established monitoring group in CoC first asked Georgian Dream to present a report about their financial transactions. Wednesday, the unit released a statement saying that the movement is violating the law.

“In the process of implementation of financial activity, we learned that on December 29, 2011, the Georgian Dream movement transferred two million lari to the bank account of Elita Burji ltd based on an agreement signed December 26, 2011, with the goal to buy the service.

On January 17, 2012, Elita Burji Ltd transferred 100 000 lari back from this 2 million lari to Georgian Dream. Three days later, Elita Burji Ltd transferred one million lari back to Georgian Dream movement based on a new agreement signed on January 20.

We think we are facing fraudulent, false deal marks. Both organizations belong to the same individual person – Bidzina Ivanishvili, head of the Georgian Dream movement. Accordingly, he himself is the client, the buyer and the provider as well. The agreements between Georgian Dream and Elita Burji Ltd are signed only for show, without a goal that the agreement would be followed by an appropriate legal results,” the Chamber of Control’s statements says.

According to the organic law about Political Associations of Citizens, all agreements whose goals are to avoid legally defined rules and restrictions are annulled. Property given or received based on such deals will become state property.

The Chamber of Control suggests to Georgian Dream to return the money to Elita Burji Ltd.

“To avoid the use of legally defined sanctions, we propose that you transfer the 1 100 000 lari which was transferred from Elita Burji to the account of Georgian Dream back to the account of Elita Burji Ltd,” the statement says.

Zakaria Kutsnashvili, lawyer for Georgian Dream and Bidzina Ivanishvili, claims that ‘the Chamber of Control exceeds its authority and tries to control the sources and other activities of a common law subject.’

He says this is not the authority of the Chamber of Control and this is a violation.

Kutsnashvili says there are a number of violations in the statement released by the CoC and the lawyers of Georgian Dream will make comments about it in the near future.

Georgian Dream released a response statement Thursday which said: “The Chamber of Control demands from the organization to refuse the 1 100 000, and otherwise threatens to confiscate this money and fine ten times the amount.'”

“To avoid the illegal deprivation of our own property and also unreasonable and strict financial sanctions we are obliged to follow the illegal request of the Chamber of Control on this level.”

The statement further says that in the near future they will take measures against the ‘illegal actions of the Chamber of Control.’



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