The Prosecutor’s Office of Georgia has filed charges against eight individuals in connection with an organised criminal group that used official positions to perpetrate large-scale fraud, launder illicit income, and orchestrate the fabrication and use of forged tax and official documents.

According to the agency, prosecutors will apply to the court within the legally mandated timeframe to have the defendants remanded in custody.

“An investigation conducted by the State Security Service of Georgia established that in the autumn of 2019, the then-General Director of JSC Georgian Railway, Davit Peradze, formed an organised criminal group. Operating under a pre-arranged scheme, the group was tasked with collecting, transporting, and sorting scrap metal belonging to JSC Georgian Railway for subsequent sale, intentionally doing so in a manner that prevented the accurate recording of its original volume.

In furtherance of this criminal conspiracy, rather than being properly inventoried and stored, a portion of the salvaged scrap metal was systematically removed from various Georgian Railway sites by lorry and delivered to Geosteel LLC’s facilities. Members of the organised criminal group produced forged tax documentation to cover their tracks.

Through this illicit scheme, members of the criminal group misappropriated 22,120 tonnes of scrap metal belonging to Georgian Railway between 2020 and 2021. After its origin was falsified, the metal was sold to Geosteel LLC. The proceeds from these sales were accumulated in the bank accounts of commercial enterprises involved in the scheme, before being periodically withdrawn in cash and divided among the group members. Consequently, Georgian Railway suffered a substantial material loss of 17,391,121 GEL.

Furthermore, in 2022, Davit Peradze formed another organised group. On April 29, 2022, a contract was signed between JSC Georgian Railway and Raveldi LLC, under which the joint-stock company purchased rail defect restoration services from the supplier. During the execution of these works, under the direct instruction and coordination of Davit Peradze, the then-Director of the Infrastructure Branch of Georgian Railway and the Director of the supplying firm entered fraudulent data into the handover acts. Based on these forged documents, Raveldi LLC received an overpayment of 403,844.69 GEL from Georgian Railway, resulting in further large-scale material damage to the state enterprise.

The detainees, alongside two individuals charged in absentia, face indictments for large-scale fraud committed by an organised group using official status, money laundering, and the organisation, creation, and use of forged tax and official documents. These offences carry a maximum penalty of up to 12 years’ imprisonment. Official search warrants will be issued shortly to locate the two individuals charged in absentia,” the statement of the Prosecutor’s Office reads.

To note, eight individuals face criminal prosecution in connection with the Georgian Railway corruption scheme. Former General Director Davit Peradze has been charged in absentia.