The Georgian National Bank has been rocked by a series of high-profile resignations over the decision of its acting governor to defy US government sanctions against former Georgian Prosecutor-General, Bidzina Ivanishvili's ally and Russian national Otar Partskhaladze.
On 18 September, when news of the sanctioning of Mr Partskhaladze, described by the US government as "a Georgian-Russian oligarch whom the FSB has used to influence Georgian society and politics for the benefit of Russia", broke, the NGB promptly froze his accounts.
A day later, the NBG and its new acting governor, GD member and former Minister of Economy Natia Turnava, reversed the move and hastily amended the NBG's regulations, making it impossible to apply the sanctions to Georgian citizens without a prior court ruling. The move – allegedly aimed at allowing Mr Partskhaladze to rescue his assets – was preceded by a stream of statements by Georgian Dream leaders, including Party Chair Irakli Kobakhidze in defense of Mr Partskhaladze.
Mr Kobakhidze specifically called the decision to freeze his accounts a “breach of the Constitution,” stressing the state must exercise special responsibility when dealing with Georgian citizens.
Archil Talakvadze, Vice Speaker of Parliament and a GD leader said he did not believe Mr Partskhaladze would do any harm to Georgia.
Most Georgian commercial banks, including the London-listed Bank of Georgia and TBC, promptly declared their compliance with the international sanctions regime. Only Cartu Bank, founded by and linked with Bidzina Ivanishvili, said it would abide by the NBG's guidelines and defy the sanctions, also taking a swipe at the Georgian opposition.
Ms Turnava quickly followed up with another statement that her guidelines were mandatory for all banks to implement.
Soon three highly respected deputy governors, Papuna Lezhava, Archil Mestvirishvili, and Nikoloz Gagua, and a senior official, Giorgi Bakradze, resigned in protest, rendering the NBG board defunct.
The very next day, parliament hastily elected two Georgian Dream loyalists nominated by President Salome Zurabishvili to the board. Ms Zurabishvili tried to withdraw her own nominees and asked parliament not to approve them but to no avail.
Although the Prosecutor's Office has tried to distance itself from Partskhaladze, Prosecutor-General Irakli Shotadze himself has publicly confirmed his friendship with Partskhaladze. Indeed, Mr Shotadze is widely regarded as the former Prosecutor General's protégé, having followed him from the financial police to the Prosecutor General's Office when Mr Partskhaladze was appointed in 2013.
Although Mr Partskhaladze resigned after it emerged that he had a criminal record in Germany (for an armed robbery in 2001), he became a close associate of oligarch and Georgian Dream founder Bidzina Ivanishvili and is believed to have remained informally in charge of the Prosecutor General's Office.
The former Prosecutor General is also believed to have acted as a key dealmaker on behalf of Bidzina Ivanishvili, working with Ivanishvili's nephew Ucha Mamatsashvili on major business deals. Mr Ivanishvili's rapper son Bera became godfather to Partskhaladze's grandchild.
According to the US government, Mr Partskhaladze obtained Russian citizenship more than a year ago with the help of an FSB officer and his business partner, Aleksandr Onishchenko.
"FSB officer Onishchenko likely assisted his associate Partskhaladze in obtaining a Russian passport and possibly Russian citizenship. Partskhaladze has fully adopted a Russian identity and regularly travels to Russia. Onishchenko and the FSB have used Partskhaladze to influence Georgian society and politics in Russia's favor. Partskhaladze has reportedly personally benefited from his association with the FSB,' the US government press release said.
Despite legal requirements, the Georgian Ministry of Justice did not revoke his Georgian passport. Although the process was finally initiated amid public outcry, Mr Partskhaladze was able to gift his properties to his son, Andria Anzor Partskhaladze.
Contrary to her initial statements calling for the cancellation of Partskhaladze’s citizenship in line with Georgian law, President Salome Zourabichvili reversed her stance, stating she would not approve the cancellation of his Georgian passport in order for him to stay in the Georgian legal sphere.
Critics say the U-turn shows Ms Zourabichvili remains under Bidzina Ivanishvili’s control on key issues despite her criticism of the Georgian Dream.
According to unconfirmed reports, Mr Partskhaladze travelled to Cyprus for which reason he needed a Georgian passport – unlike Russia Georgia has visa visa-free regime with the EU.
Publika, a Tbilisi-based media outlet, has discovered Mr Prtskhaladze's son is one of the founders of the pro-Russian group Conservators' Union and Solidarity for Peace, which advocates neutrality for Georgia. The head of the Conservators' Union, Archil Bubuteishvili, attended a conference in Moscow in December 2022 on deepening Georgian-Russian relations, which was also attended by Leonid Kalashnikov, a key Russian MP on Georgian issues and a Committee Chair in the State Duma.
Georgian Dream leaders say that the NBG's rules, which require a Georgian court ruling for any international sanctions against Georgian citizens, will "protect" Georgian citizens from similar "unfair" sanctions in the future.
On 14 September, the United States imposed sanctions against Otar Partskhaladze, Georgia's former Prosecutor General, against the backdrop of escalating tensions in Ukraine. The US State Department alleges that Russia's Federal Security Service used Partskhaladze as a means to influence Georgian society and politics in support of Russian interests.
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