Law enforcement in Georgia, located in the South Caucasus region, apprehended five individuals from Russia who are suspected of operating an illicit cryptocurrency enterprise and laundering funds through unlawful financial methods, officials reported on Thursday.
According to the Georgian Finance Ministry, this group of Russians was allegedly managing a virtual asset service from an unregistered office, utilizing unauthorized “courier” networks without clearance from the National Bank of Georgia. The ministry did not disclose the identities of the five suspects or the name of the business implicated in these activities.
The investigative division of the Finance Ministry noted in a statement that, over recent months, the entity engaged in virtual asset transactions worth hundreds of millions of lari, enabling uncontrolled international transfers within the country. For context, one hundred million lari is approximately equivalent to $37 million.
Georgian authorities indicated that the Russians transported significant amounts of foreign currency into the country by vehicle, successfully bypassing border checks. Allegedly, these funds were used to acquire digital currencies, which were then used to disguise the origin of the money.
Despite the extensive scale of the operation, tax officials in Georgia reportedly found no documentation of payments or tax filings from the individuals or companies involved.
Police conducted raids at several sites in Tbilisi, the capital of Georgia, leading to the confiscation of $721,000 in cash, business records, and computer equipment, according to officials.
The five Russian nationals could face up to 12 years in prison on counts of conducting unauthorized business activities and laundering proceeds from illegal activities. Georgian officials stated that their investigations are ongoing, looking into additional suspects and potential tax evasion cases.
The Russian Interests Section at the Swiss Embassy in Georgia, which has acted as an informal embassy since 2008, has not yet made a statement regarding the arrests.
