When Georgian Water & Power (GWP) was privatized and purchased in 2008, the announced buyer was Multiplex Energy Limited.
But in reality, the $60.8 million used to purchase the Tbilisi region water company was money that had been illegally moved out of Russia.
The Organized Crime and Corruption Reporting Project (OCCRP) on Monday published the Troika Laundromat, describing $US400 billion worth of transactions and how more than 3.5 billion euros left Russia between the years of 2006-12.
LINK ” The Troika Laundromat”
The Troika Laundromat emerges from leaked documents analyzed by OCCRP and several media partners in recent months. They include over 1.5 million banking transactions, as well as thousands of emails, contracts and company registration forms. iFact.ge is an OCCRP partner.
Armenian-born Ruben Vardanyan was the controlling shareholder of Troika Dialog, Russia’s largest privately held investment bank. The bank created an overseas company, one of dozens of such companies used to move billions of dollars either to secretly buy shares in major Russian companies, or into offshore accounts and investments.
Troika Laundromat companies were used to hide investments made by Russian businessmen abroad, sometimes in places where Russians were not welcome. In the summer of 2008, just a month before Russia and Georgia went to war, the Laundromat sent $85 million to Multiplex Energy Limited, a British Virgin Island-registered company that used some of that money to buy the water system. The non-transparent privatization left 1.4 million Georgians wondering who controlled their water supply.
The money came from three major Troika Laundromat companies and Renaissance Capital, a Russian investment fund.
Ukraine-born Andrei Rappaport is one of the key users of the Troika Laundromat and has close ties to its creators. Between 2002 and 2004, Rappaport held a 1 percent share in Troika Dialog Bank. He later became president of the Moscow School of Management Skolkovo.
He is also a member of the Russian Jewish Congress, one of many recipients of donations from the Troika Laundromat.
In 1991, after the collapse of the Soviet Union, Rappaport served as the chairman of one of Russia’s new commercial banks, Alfa Bank. Between 1997 and 2008, he served as deputy chairman and as a director of the huge state-run Unified Energy Systems (RAO UES) — a period in which its subsidiaries were gradually privatized.
LLC Tbilisi Water was founded by Tbilisi City Hall in 1997. The company listed assets of $US199 million at the time of the 2008 privatization deal. The water system was sold in to Multiplex Energy Limited — a mysterious offshore company in the British Virgin Islands — without any public tender.
Rappaport was listed as an 85 percent owner of Multiplex Energy. Other owners were unnamed Georgians.
Multiplex Limited later changed its name to Georgian Global Utilities (GGU). In 2014, JSC Georgia Capital, a subsidiary of Bank of Georgia, paid 47.6 million lari ($US26.25 million) for a 25 percent share of GGU. In 2016, JSC Georgia Capital paid 152.6 million lari ($US70 million) for the remaining 75 percent.
By Nino Bakradze and Dave Bloss