The monetary fine of 465 000 (Four hundred sixty-five thousand) GEL was imposed on the Virtual Asset Service Provider “SHER888” LLC (I.N. 405531740).

• the Provider submitted incorrect information/documentation requested during the inspection process. Pursuant to subparagraph “n” of paragraph 3 of Article 2 of the “Rule on Determining, Imposing and Enforcing Monetary Penalties on Virtual Asset Service Providers and Their Administrators,” approved by Order No. 133/04 of the President of the National Bank of Georgia dated 29 May 2024 (hereinafter – the “Penalty Rule”), a monetary penalty of GEL 3,000 (three thousand) is prescribed for each instance of incorrect submission of information/documentation stipulated under each clause of the agreement. The total amount of the penalty imposed is GEL 6,000 (six thousand).
• the Provider violated subparagraph 9 of Article 7 of the “Rule on Registration, Deregistration, and Regulation of Virtual Asset Service Providers with the National Bank of Georgia,” approved by Order No. 94/04 of the President of the National Bank of Georgia dated 13 June 2023 (failure to conduct operations with properly functioning video surveillance). In accordance with subparagraph “s” of paragraph 3 of Article 2 of the Penalty Rule, this violation entails a monetary penalty of GEL 5,000 (five thousand).
• The Provider violated the requirements of subparagraph “d” of paragraph 1 of Article 18 of the Law of Georgia on Facilitating the Prevention of Money Laundering and Terrorism Financing (hereinafter – the “Law”). Pursuant to subparagraph “d” of paragraph 3 of Article 2 of the Penalty Rule, this violation entails a monetary penalty of GEL 3,000 (three thousand). The total amount of the penalty imposed is GEL 3,000 (three thousand).
• The Provider failed to determine the purpose and intended nature of the business relationship. Pursuant to subparagraph “t” of paragraph 3 of Article 2 of the Penalty Rule, a monetary penalty of GEL 3,000 (three thousand) is prescribed for each client. The total amount of the penalty imposed is GEL 78,000 (seventy-eight thousand).
• The Provider violated the obligation prescribed under Article 4 of the “Rule on Identification and Verification of Clients by Accountable Persons,” approved by Order No. 2 of the Head of the Financial Monitoring Service of Georgia dated 5 June 2020 specifically, providing services without complying with the identification requirements for natural persons. In three (3) cases, verification of clients through valid identification documents could not be confirmed (due to the absence of copies of documents within their validity period), while in one (1) case, the Provider failed to present information/documentation intended for client verification. Pursuant to subparagraph “b” of paragraph 3 of Article 2 of the Penalty Rule, each such violation entails a monetary penalty of GEL 1,000 (one thousand). The total amount of the penalty imposed is GEL 4,000 (four thousand).
• The Provider failed to conduct monitoring of the business relationship and examination of transactions, activities, property, and/or the source of funds/virtual assets in accordance with the legislation and the Provider’s internal policies/procedures. Pursuant to subparagraph “z” of paragraph 3 of Article 2 of the Penalty Rule, a monetary penalty of GEL 5,000 (five thousand) is prescribed for each client. The total amount of the penalty imposed is GEL 80,000 (eighty thousand).
• During the inspection, it was revealed that the software (electronic) system intended to ensure automatic screening of persons/virtual asset addresses against lists of politically exposed persons, persons subject to sanctions under UN Security Council Resolutions, the “Rule on Compliance with Sanctions Regimes by Accountable Persons under the Supervision of the National Bank of Georgia,” approved by Order No. 208/04 of the President of the National Bank of Georgia dated 4 August 2023 (hereinafter – the “Sanctions Compliance Rule”), and/or other sanctions regimes prescribed by the National Bank through written instructions, was operating with significant deficiencies. Pursuant to subparagraph “e” of paragraph 2 of Article 2 of the Penalty Rule, such a violation entails a monetary penalty of GEL 15,000 (fifteen thousand).
• In five hundred twenty-eight (528) transactions (operations), the Provider failed to comply with the requirements regarding the recording and/or retention of information/documentation established under Article 27 of the Law of Georgia on Facilitating the Prevention of Money Laundering and Terrorism Financing. Pursuant to subparagraph “a” of paragraph 4 of Article 2 of the Penalty Rule, a monetary penalty of GEL 500 (five hundred) is prescribed for each violation. The total amount of the penalty imposed is GEL 264,000 (two hundred sixty-four thousand).
• During the inspection process, the Provider obstructed the inspection, which caused delays in its completion. Specifically, the provision of incorrect, inaccurate, incomplete, and ambiguous information reflected in the inspection act resulted in an extension of the inspection period and hindered the selection of clients for review and the analysis of their transactions. Pursuant to subparagraph “i” of paragraph 2 of Article 2 of the Penalty Rule, such obstruction entails a monetary penalty of GEL 10,000 (ten thousand).