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Scandalous development company Center Point Sold

By Tea Mariamidze
Friday, September 29
The Center Point Company, whose managers have been detained for fraud and embezzlement of their clients’ money, has been sold.

The information was released by the head of the company board, Guram Rcheulishvili.

He did not specify the name of the new owner, however, but explained that all the affected developers would receive compensation.

“The main term of selling our company was to satisfy all of those affected. This was agreed at a plea bargain with the Prosecutor’s Office,” he added.

Rcheulishvili said that this is one of the biggest deals in Georgia.

“There is much work and we do not know exactly how much time the whole process will take,” he added.

Guram Rcheulishvili also said that Center Point was purchased by one company.

“The buyer will take responsibility to satisfy all the victims and we are going to protect the interests of the victims with this company,” he said.

The Center Point Case is the biggest construction scandal in Georgia. In 2012, the non-governmental organization Transparency International (TI)-Georgia prepared a report on the case, saying that, in total, the Center Point Group had mishandled USD 310 million paid by around 6,200 customers for the construction of their houses.

The company went bankrupt following the 2008 war. Dexus, a company managing Center Point Group’s assets since September 2010, pledged to finish suspended constructions within three years. The company was established on 23 August 2010, just two weeks before undertaking the management of Center Point Group’s construction projects.

However, Dexus has worsened the initial conditions for the affected customers by asking them to pay burdensome taxes and additional costs for their houses. According to NGO TI-Georgia, Dexus became involved in an allegedly illicit deal through which the founders of the Center Point Group claimed customers’ valuable property.

In early April 2017, Tbilisi City Court sent the founders of the Center Point Group construction company, former Vice-Speaker of Parliament Rusudan Kervalishvili and her sister Maia Rcheulishvili, to prison for four years for embezzlement and misspending of clients’ money.

The case has been in progress for more than four years. The sisters are accused of misspending approx. 34 500 000 GEL in total.

Guram Rcheulishvili was also detained with the charges of embezzlement of 19 million GEL.

He was released on April 7. Prosecutors had been demanding the release of Guram Rcheulishvili in exchange of a bail worth 50,000 GEL, but he eventually left prison after paying 30,000 GEL in bail.