Georgia detains former fund head in Lagi Capital embezzlement scandal

Former Executive Director of Georgia’s Municipal Development Fund, Davit Tabidze, has been arrested in connection with a case involving the illegal appropriation of state property and money laundering by the company Lagi Capital.

At a briefing held by the Investigation Service of the Ministry of Finance, it was announced that he was accused of abusing his official authority, Caliber.Az reports via Georgian media.

The Fund’s Programme Manager and Project Manager were also arrested in connection with the case and were cooperating fully with investigators.

“The heads of Lagi Capital LLC have been arrested on charges of fraudulently appropriating GEL 9,365,801 allocated from the Municipal Development Fund for the rehabilitation of 30 kindergartens, and legalising GEL 1,211,000 in illegal proceeds. The investigation has established that they possessed information that the advance payment requests submitted by Lagi Capital LLC during the period from July 2023 to May 2024 were unsubstantiated and only partially secured,” the Investigation Service said.

The officials were aware that the company had failed to use the advance payment it received in July 2023 for its intended purpose, but still issued another unjustified advance of 11.2 million lari ($4.1 million) for the restoration of kindergartens.

The detainees face between nine and twelve years in prison. 

By Jeyhun Aghazada