Head of the Office of Sanctions Coordination at the US State Department, Ambassador James O’Brien expressed concern about the National Bank of Georgia’s (NBG) decision and warned of the risks of possible sanctions for individuals who conduct transactions with former General Prosecutor of Georgia Otar Partskhaladze.

In his written response to the Accent, Ambassador O’Brien said that an independent National bank is a cornerstone of a sound economy in any nation.

"On September 14, the United States imposed sanctions against Georgian-Russian oligarch Otar Partskhaladze, who was working with the FSB to influence Georgian society and politics for the benefit of Russia. He was designated pursuant to Executive Order 14024, which authorizes sanctions with respect to specified harmful foreign activities of the Government of the Russian Federation.

We regret the National Bank of Georgia’s decision. Entities and individuals engaging in transactions with Partskhaladze or others designated under our Russia-related sanctions authority risk exposing themselves to sanctions.

Georgia’s banking system has been one of the best achievements of Georgia’s democratic story. An independent National bank is a cornerstone of a sound economy in any nation," Ambassador O’Brien said.

More context: On September 14, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions on Otar Partskhaladze. The State Department stated that Partskhaladze was designated for his efforts to influence Georgian society and politics in cahoots with the FSB officer.

On September 18, NBG said it froze assets and restricted transactions of Otar Partskhaladze. But On September 19, it issued a statement alerting the public to the amendment to its regulation that the Bank’s president promulgated and published in the official gazette. The new statement by the National Bank says while the Bank faithfully implements the international sanctions regime, sanctioning of Partskhaladze “sets a precedent when sanctions are applied to the Georgian citizen.”

“The Georgian citizens are protected by the Constitution, being guided by the Constitution of Georgia and the presumption of innocence, considers that the Georgian citizen can not be subjected to international sanctions, in the absence of the conviction by the Georgian court.” the statement reads.

After the decision of the acting President of the National Bank of Georgia, Natia Turnava three NBG Vice Presidents, Papuna Lezhava, Archil Mestvrishvili, and Nikoloz Gagua filed for resignation. Giorgi Bakradze, an Advisor to the NBG President, also tendered his resignation.

The NBG’s decision sparked widespread public criticism, including a strong rebuke from Georgian President Salome Zurabishvili, who accused Natia Turnava of tarnishing both the bank’s and the nation’s reputation and called for her resignation. Zurabishvili also urged the NBG Board to overturn the controversial decision.