Georgia prosecutors reportedly charge billionaire George Bachiashvili for misappropriation of funds in Bitcoin, money laundering
Bachiashvili is a powerful figure in Georgia, having founded a private equity firm that contributes about 40% to the country's GDP.
Georgian news outlet Agenda reported Thursday that George Bachiashvili, the founder of the Georgian Co-Investment Fund, known for running a $6 billion private equity fund contributing about 40% to the nation’s GDP, has been charged with cryptocurrency misappropriation and money laundering.
The Prosecutor’s Office of Georgia alleges Bachiashvili misappropriated a “large amount” of cryptocurrency, notably Bitcoin, dating back to actions taken in 2015.
Bachiashvili, previously recognized on Forbes 30 Under 30 – Finance (2014) for his role in managing the fund backed by Georgia’s billionaire prime minister, reportedly invested in Bitcoin mining using funds “personally raised” by him and an unidentified investor. The funds were used to secure mining services from a foreign firm under a one-year contract valued at $6.3 million, wherein the investor’s share was $5 million.
The mining operation, as reported by Agenda, generated 24,662 BTC within a year, leading to a profit of 8,253 BTC. This profit was supposed to be divided among the investor and Bachiashvili by the invested amounts and accumulated in a cryptocurrency wallet owned by an enterprise under Bachiashvili’s control.
However, the Prosecutor’s Office contends that Bachiashvili, in 2017, appropriated the profit, paying only a tiny portion of the profits to the investor and hiding the details of the remaining appropriated bitcoins, valued at over $39 million, according to Agenda.
However, as of press time, 8,253 BTC would be worth $251 million, suggesting the numbers used by Georgian officials denotes the value at the time of the alleged crime rather than today’s valuation.
The alleged actions of Bachiashvili, including the concealment of unauthorized cryptocurrency transactions, have resulted in severe legal repercussions. As reported by Agenda, if found guilty of cryptocurrency misappropriation and money laundering, he faces between nine and 12 years in prison.
Despite the controversy, the Georgian Co-Investment Fund released a statement indicating that it was not involved in Bachiashvili’s alleged actions, nor could they comment further on the investigation due to Bachiashvili’s previous role on its supervisory board.