Former Georgian Defense Official Paid Cash For a Secret London Flat

A former Georgian deputy defense minister purchased a pricey London flat through an offshore shell company, and failed to declare that firm as required by law, records show. 

Thanks to new transparency disclosures required in the U.K., journalists discovered that Mamuka Mujiri established an offshore company in the Seychelles shortly before he left his defense ministry post in 2008. He used the firm to buy a two-bedroom apartment in London’s South Hampstead neighborhood in August 2009 for £560,000 ($900,000).

Mujiri was appointed in 2005 to the deputy defense minister position –– where he was involved in procuring arms –– but he was dismissed three years later during a major reshuffle following the invasion of Georgia by Russian forces. 

As a government official, Mujiri was required to submit asset declarations every year from 2003 until 2008, and he needed to make a final declaration after he left the defense ministry. His final declaration did not include the offshore firm, Brentley Corporation, nor income or assets that explain how he was able to afford the flat.  

Batu Kutelia, who served as a deputy defense minister at the same time as Mujiri, said authorities should take action against public officials who withhold financial information.

Georgian Neighbors

When Mujiri bought his London flat, another unit in the complex was owned by Sulkhan Papashvili, one of Georgia's richest citizens. These days, Papashvili is in the energy business, but he once headed the Special Service of the State Protection of Georgia.

Mujiri served as the deputy head of the service under Papashvili in 2003. A law firm representing Papashvili declined to comment about whether he had anything to do with Mujiri’s purchase of the London flat.

Another unit was owned by George Kukhaleishvili, a longtime business partner of Papashvili’s who also had an association with Mujiri. In land registry documents, Mujiri’s Brentley Corporation listed Kukhaleishvili’s apartment as a correspondence address. And Mujiri used a property management company co-owned by Kukhaleishvili, Kornerstone Limited, as his own correspondence address for the U.K.’s “ultimate beneficial ownership” corporate registry.

A law firm representing Kukhaleishvili and Kornerstone did not reply to questions about its apparent relationship with Mujiri. The firm said business dealings between Kukhaleishvili, Kornerstone and their clients follow “all due diligence compliance and regulatory requirements.”

“Not only non-submission, but deliberate avoidance to disclose incomes, or loopholing practices should be thoroughly investigated, strongly prosecuted and any ill-gained wealth sanctioned,” he said, adding that he had no knowledge of any irregularities involving Mujiri in particular.

Mujiri did not respond to requests to comment.

His declarations show that neither he nor his family possessed sufficient income or assets to buy the flat which –– according to its U.K. land registry document –– was purchased outright, using no mortgage or bank loan.

Mujiri’s annual salary never exceeded $20,000, while his wife and parents together earned less than $10,000 per year. That was close to the Gross National Income per person, which the World Bank put at $9,580 in 2010, a year Georgia suffered a 70 percent poverty rate.

Mujiri’s family’s declared assets, nearly all of which were held by his father at the time, also fail to explain the source of financing for the apartment. They included real estate worth about $200,000 in 2008, plus savings, a painting, an antique vase, and securities valued at around $150,000. Georgia’s land registry does not show that Mujiri owned any property in the country before 2017.

Documents acquired by OCCRP and its Georgian reporting partner, GMC, show no signs of business activity by Mujiri or his Brentley Corporation that could explain the source of funds for the purchase of the London flat.

View of Visage apartments entrance in London. (Photo: Katie McCraw/OCCRP)

New Regulations, New Revelations

For over a decade, both Mujiri’s offshore company and his apartment remained secret. 

Then, in 2022, the U.K. passed a law requiring foreign entities that own properties in England and Wales to disclose their ultimate beneficial owners (UBO) ––  the person who ultimately controls a corporate entity and stands to profit from it. 

On January 12, 2023, Brentley Corporation complied, disclosing that Mujiri was its UBO since incorporation. Just a few weeks after Mujiri’s ownership became publicly available information, land registry documents show that he sold his flat for £615,000 ($760,000).

By that time, Mujiri had been out of the public service for more than 14 years. Before leaving, he held senior positions at various ministries under two consecutive presidents.

He first served underEduard Shevardnadze, who was forced to resign in November 2003 as a result of widespread protests known as the Rose Revolution. He then worked in the administration of Mikheil Saakashvili, Shevardnadze’s successor.

Before his appointment to the deputy defense minister post, Mujiri’s résumé included stints at the State Security Ministry, the Prosecutor General’s Office, and the Ministry of Internal Affairs.

Russia’s five-day invasion of Georgia in 2008 appears to have put an end to his public service career. The war was widely seen as a disaster for Georgia, and Russian forces continue to occupy large areas of the country’s territory today.

In the aftermath of the invasion, NATO member states began calling on Georgia to institute defense reforms. Meanwhile, the political opposition in Georgia pushed for the dismissal of Defense Minister Davit Kezerashvili.

Under pressure, Saakashvili launched a major reshuffling of his cabinet, leading to the dismissal of Kezerashvili along with his deputies, including Mujiri.

A Suspicious Arms Deal

As a deputy minister, Mujiri had been involved in military procurement, according to a November 2008 U.S. diplomatic cable released by Wikileaks. 

The cable, which is classified as “secret,” includes concerns raised by the U.S. State Department’s Office of Defense Trade Controls Compliance (DTCC) about Georgia’s efforts to procure a shipment of rifles and grenade launchers. Mujiri signed off on paperwork for the shipment on behalf of the Georgian defense ministry.

The arms deal was brokered by a Seychelles-registered firm and a Bulgarian company. The DTCC had information indicating “both companies' connection to organized crime and grey arms trafficking,” according to the cable.

The Georgian Ministry of Defense did not respond by publication to a request for comment about the arms deal, and Mujiri’s role in weapons procurement. 

Kutelia, the former deputy defense minister who worked with Mujiri, said Georgia was prohibited at the time from buying Western-manufactured material, such as armored vehicles, artillery, and air defense systems.

Russian soldiers passing by a destroyed Georgian tank in the South Ossetian capital of Tskhinvali in 2008, during the Russian invasion of Georgia. (Photo: UPI Photo/Anatoli Ivanov/ Alamy stock photo)

“Therefore, most of the territorial defense capabilities that Georgia has acquired were old Soviet standards, purchased in the post-Soviet markets,” he said. “Those markets have a high level of corruption risks.”

He said he had no knowledge of Mujiri’s involvement in military procurement, which was “outside my portfolio at the ministry.”

At the time Kutelia and Mujiri were in the ministry, Georgia’s defense sector was undergoing major reforms under a “strategic review” implemented in close coordination with NATO. 

“Minimization of the corruption risks was one of the main priorities of the defense reform,” Kutelia said.

He said measures included separating the defense ministry’s financial and procurement departments, increasing parliamentary oversight, and improving the ability to investigate and prosecute corruption in a timely way through an independent judiciary.

“Each of those components were not perfect by 2008,” Kutelia said.

Additional reporting by Kelly Bloss (OCCRP)