U.S. to allocate $29.3 million to Azerbaijan

The U.S. will allocate $29.3 million to Azerbaijan to develop democracy in 2011, the website foreignassistance.gov. reported.

U.S. assistance to Azerbaijan is aimed at promoting democratic reforma, strengthening governmental checks and balances, increasing public participation in state affairs, as well as combating domestic and transnational crime, including money laundering, terrorism financing, corruption, human and drug trafficking. U.S. assistance also helps to expand and diversify the country's economic growth by eliminating critical economic policy and institutional constraints to ensure stability and sustained growth in the sectors of the economy.

Georgia will receive $ 90.1 million in 2011, Armenia - $ 45.2 million, Russia $ 68.7 million, Turkey - $ 5.9 million.

Source: foreignassistance.gov

Georgian crime boss sentenced in Spain for money laundering

A Spanish court on Tuesday convicted a top Georgian crime gang leader of money laundering and sentenced him to seven and a half years in jail.

Spain's top criminal court also slapped Zahar Kalashov, who was extradited to the country from Dubai in 2006, with a fine of 20 million euros (24.6 million dollars).

The court said he laundered money earned from criminal activities carried out in the former Soviet Union, such as kidnappings and the operation of illegal casinos, by investing in real estate and luxury cars in Spain.

It said he should be deported once he has served three-quarters of his sentence and will then be banned from entering Spain for a decade.

Public prosecutors had asked that Kalashov, who police suspect led the Georgian mafia in Spain, be sentenced to 12 years and two months behind bars.

Five other men who were detained as part of the same police investigation into the group were also convicted of money laundering at a separate trial last year and received prison sentences of between two and five years.

Kalashov fled Spain after police launched "Operation Wasp" in June 2005 which culminated in the arrests of 28 suspected members of his organisation from former Soviet states in Barcelona, Alicante and Malaga.

The swoop saw 800 bank accounts frozen and the impounding of luxury villas and vehicles along with the seizing of some 300,000 euros in cash.

Source: AFP

Georgia: Labors leader suspected in money laundering

Archil Benidze, a member of the Georgian Labor Party, suspected in money laundering and was detained on 25 July, has been sentenced to two months preliminary detention.

Reportedly, the leader of the party Shalva Natelashvili has also suspected in money laundering and he will be summoned for questioning.

According to prosecutor's office, they have got an audio tape where Natelashvili was negotiating with Anatoli Motkin, a friend of the Georgian tycoon Badri Patarkatsishvili, about money transfers; the negotiations were held about transferring of 100,000 dollars.

Source: The Georgian Times

MONEYVAL Publishes Third Round Evaluation Report on Georgia

By Christina Tashkevich

The Council of Europe's Committee of Experts on the Evaluation of Anti-Money Laundering Measures (MONEYVAL committee) has published its Third Round evaluation report on Georgia praising major changes in Georgia regarding money laundering and terrorist financing but also noting several 'must-dos' for the Georgian government.

The report, for example, notes that in 2003 when the MONEYVAL committee issued its Second Round report, Georgia had no anti-money laundering preventive law, no regime to report suspicious transactions, nor any real provisional measures, confiscation regime or financial intelligence unit.

In January 2004, however, a law on facilitating the prevention of illicit income legalization came into force and a financial intelligence unit was created. The report also says that money laundering cases have been brought to Georgian court, winning convictions.

However, the committee says there are issues the Georgian government still needs to address.
For example, according to Georgian legislation, income from crimes committed in the taxation fields and any offences involving less than GEL 5 000 (approx. EUR 2 230) cannot be considered money laundering offences.

The report also criticizes Georgian legislation for not obliging financial institutions to pay closer attention to the financial interactions of public figures. "Georgian legislation does not oblige financial institutions to apply enhanced due diligence for higher risk categories of customers (e.g. politically exposed persons), transactions and products," says the report.

The MONEYVAL committee also notes that Georgia still has no effective system of detecting the physical transportation of currency across borders.

Talking about the criminal situation in the country, the committee says organized crime and corruption remain major issues for the Georgian authorities to address.

"The legalization of illicit assets is still a major preoccupation of organized crime groups in Georgia. The major sources of illegal income are considered to be the same as at the time of the second evaluation [in 2003]. Illegal proceeds remain largely generated through smuggling, tax evasion, fraud, bribery, misappropriation and embezzlement, and abuse of power by public servants," the report reads.

In 2003, there was the threat of Georgia being put on the "black list" of countries considered attractive for money laundering operations, compiled by the Finance Action Task Force on Money Laundering (FATF). In response, the Georgian government drafted legislation to combat money laundering.

http://www.messenger.com.ge/issues/1382_june_20_2007/n_1382_3.htm