GEORGIA: BURJANADZE'S TAX SAGA CONTINUES

C O N F I D E N T I A L SECTION 01 OF 02 TBILISI 001784

SIPDIS

E.O. 12958: DECL: 09/28/2019
TAGS: PGOV PHUM PREL GG
SUBJECT: GEORGIA: BURJANADZE'S TAX SAGA CONTINUES

REF: A. TBILISI 1674

B. TBILISI 1568

Classified By: CHARGE D'AFFAIRES A. I. KENT D. LOGSDON. REASONS: 1.4
(B) AND (D).


1. (C) Summary: Former Speaker of Parliament, Nino
Burjanadze (Democratic Movement - United Georgia) has
indicated that she may challenge President Saakashvili to
arrest her on what she believes are trumped up tax penalties
in connection with a property she received for one lari (60
cents) in 2008 (ref A). Burjanadze spoke to Poloff and then
subsequently with the Charge and indicated her frustration
with western silence regarding what she terms Saakashvili's
unfair and vindictive treatment of her. The Charge
d'Affaires raised concerns about the appearance and propriety
of the lawsuit with Deputy Foreign Minister Giga Bokeria.
Burjanadze has requested another meeting with the Charge to
discuss the case further. End Summary.


2. (C) Comment: It has been an open secret that the GoG
has been waging an aggressive campaign to collect taxes,
which has affected more individuals than just Burjanadze (ref
B). If Bokeria's response is any indication, this legalistic
argument will likely make up a large portion of the GoG's
response to concerns about the propriety of the prosecution.
Burjanadze's own unclean hands, particularly in accepting the
property in the first place, hardly make her a sympathetic
figure to the public. Nonetheless, any arrest of Burjanadze
or other over the top treatment of her would seem
disproportionate to the nature of the dispute, and post will
continue to urge the GoG to proceed in an open, transparent
and proportional manner. Our European colleagues are
preparing similar approaches to the Government, but have also
taken a private approach to the issue. Regardless of our
interventions, at this point, it looks likely that the GoG
will move ahead with the seizure and auction of the property
in question as scheduled on October 7. End Comment.

The Phone Calls


3. (C) Burjanadaze called Poloff on September 22 to ask
what the USG response (if any) would be regarding the GoG's
lawsuit against her for failure to pay taxes on a dacha she
received for one lari (60 cents) (ref A and ref B). When
asked as to what specific response Burjanadze wanted from the
USG, she admitted that she was not sure. Burjanadze
complained about being abandoned by her western friends in
the face of an unfair and vindictive smear campaign against
her. Burjanadze told Poloff she would demand that President
Saakashvili arrest her and that "then maybe my western
friends will comment." During the course of the 20 minute
phone call, Burjanadze repeatedly apologized for being overly
emotional.


4. (C) Charge spoke with Burjanadze on September 23 and had
a similar conversation. Burjanadze complained that she had
been accused of collusion with Russia, money laundering, and
misappropriating state assets -- all without the GoG
substantiating the allegations. She also accused the
Government of planting false information in the Ukrainian
press about her recent visits to Kyiv (including allegations
that she was trying to borrow money from Ukrainian banks and
Ukrainian oligarch Viktor Pinchuk) and said that her lawyers
were investigating libel laws in Ukraine. The Charge noted
that post had regularly raised the issue privately with
senior Georgian leaders. Burjanadze replied that she
appreciated the private support post provided, but since the
people of Georgia only read "the lies" in the press, no one
knew that post had been engaged on the issue. According to
Qknew that post had been engaged on the issue. According to
Burjanadze, her supporters routinely ask her "where are your
western friends?" Burjanadze said a lack of western response
has been particularly difficult for her since some of her
supporters have been arrested or forced to pay money to the
tax police (to the point of having to sell their houses and
cars to stay out of jail) over the past few months.
Burjanadze again raised the issue of her potential arrest.

DFM Bokeria Hears Concerns - Says Little


5. (C) The Charge and Polchief relayed our concerns to
Deputy Foreign Minister Giga Bokeria and noted that,
regardless of the merits of the case (ref A),the optics of
quickly auctioning off the property (scheduled for October 7)
were not good. The Charge stressed that arresting Burjanadze
in connection with the tax case would also likely be viewed
in the West as overly zealous. Bokeria responded that the
GoG had a legitimate legal case and pursuin it against
Burjanadze, like any private citizen, was well within the
GoG's normal rights. When the Charge asked specific
questions about the legality of moving against just this
property or the inability of Burjanadze to provide her own

TBILISI 00001784 002 OF 002


experts' assessment of the value of the property to the
court, Bokeria said that he could not guess as to the legal
issues involved. The Charge noted that even if one conceded
the legal argument, the GoG should consider that any arrest
of Burjanadze would cause a political reaction from the West
and urged the government to proceed cautiously.
LOGSDON