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Monday 18.12.2017 | Name days: Klinta, Kristaps, Kristofers, Krists

Liepājas metalurgs suspected of being involved in “black market” deals

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Аuthor: Evija Trifanova/LETAThe steel transported from Liepājas metelurgs (LM) to Poland miraculously becomes cheaper with every passing kilometre, note Polish television TVP journalists.

Ernst & Young had previously noted that LM’s procurement of raw materials and the sales of ready products has a number of unnecessary mediator firms involved. This creates suspicion that LM is involved in VAT defrauding schemes, Nekā personīga (Nothing personal) programme of TV3 reports.

According to official statistics, Latvia exported nearly 300 thousand tons of steel rods to Poland in 2011. However, the statistics of the Polish Finance Ministry shows the number if imported steel rods to be 60 times smaller. This fact allows for the possibility that LM’s products are being sold on the black market. LM has yet to respond to questions of the Polish journalists. The company also declined to give TV3 an interview.

Polish journalists tried tracing this. They started in the courtyard of LM: 28 of 40 trucks parked there were from Poland. Some Polish driver had told them that he drives the Poland-Latvia route at least once a week. He carries scrap metal on the way to Latvia, so that metal is processed at the plant. Steel is then transported from Latvia to Poland. Journalists had uncovered at the Polish border that illegal steel from Liepaja is being sold on the Internet for massively reduced prices. A representative of some company had offered journalists 500 tons of steel rods from Liepaja for 1860 zloty per ton, saying that the price is such only because the product is fresh from the plant. The person who offered the unbelievably cheap steel from LM was investigated also.

“If this scheme is what it appears to be and it works, these people have been earning millions that were stolen from the company’s budget. With that I say – this is a barbaric type of theft that does not create any added value and does not give anything back to the company,” – Tolmets Chairwoman Inta Ozolina told the programme.

She allows for the possibility that the desire of LM owners to earn through illegal means using mediators abroad could have been the reason why LM previously declined to continue buying scrap from Tolmets.

On April 4, LM’s largest owner Sergei Zakharin met with the company’s workers for the first time in the last two months since the first announcements about the possible bankruptcy of LM. The meeting was held behind closed doors.

LM worker Inese Gausena said Zakharin offered to bring buses to travel to Riga and hold a protest act near the Cabinet of Ministers, so that the government does not put off this matter. Everything points to the fact that the protest act could very much take place on April 16. None of the interviewed workers could confirm that Zakharin managed to find some investor or would be willing to invest his own money into saving LM.

Zakharin has been in Turkey during the last week; possibly holding negotiations with possible investors. Journalists of Nekā personīga acquired a photo featuring Zakharin and his wife in Istanbul, where the two participate in some jubilee. The person celebrating was the Belarusian billionaire Yuri Chizh, whom the EU had included in the “black list”. His funds in Europe were frozen and he is denied entry. With that, he is unable to invest money in Latvia directly.


Leave a reply

  1. Ilmars says:

    Another week , another scandal .
    And these fraudsters have the cheek to ask for taxpayers money to bail them out.
    They should not be given one cent , the plant closed down , the workers given compensation , and these criminals put in jail .

    Thumb up 0 Thumb down 0

  2. Bozo the clown says:

    Latvia banana banana republica.

    Thumb up 0 Thumb down 0

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