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Wednesday 18.09.2019 | Name days: Liesma, Elita, Alita

BNN summary of the week: cartel scandal; Lithuania's food vouchers; Estonian party's financial problems

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThis week’s biggest piece of news in Latvia is associated with the so-called ‘cartel case’ involving major construction companies. There is also the possibility of the range of involved companies expanding further. According to existing information, then the prime minister of Latvia Māris Kučinskis was aware of the growing problem. With the cartel case Corruption Prevention and Combating Bureau (KNAB) has interviewed ex-president of Latvia Raimonds Vējonis and ex-Saeima deputy Ingmārs Līdaka. It is also allowed that this scandal may have caused an increase of construction costs in Latvia on top of everything else.

Meanwhile, Lithuania’s Agriculture Ministry has decided to drop the initiative on adoption of an electronic food voucher system. Initially it was intended to assist with countryside development but it was met with dislike by residents and public organizations.

Estonia’s Green Party, on the other hand, faces financial difficulties. Estonian political parties’ financing supervisor has recommended the party to commence a bankruptcy process, saying that the party is unlikely to crawl from lasting financial difficulties.

BNN provides a news summary about the key events of the week, including such topics as Investigation, Hope, Surprise, Decline, Announcement, Disappointment, Amount, Memories.


Latvia’s KNAB interviews current and former owners of high-profile construction companies

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU

On Tuesday, 3 September, Armands Garkāns, co-owner of construction company Arčers and road construction company Binders, was seen at the office of Corruption Prevention and Combating Bureau (KNAB), as reported by LETA.

The agency observed him leaving KNAB office, but he did not provide any comments to journalists. Public broadcaster LTV reports that Garkāns denies having been given any status.

LTV also reports that KNAB office was visited by ex-board chairman of construction company SIA Skonto Būve Guntis Rāvis, who did not provide any reasons for his visit to KNAB. Aside from those two, KNAB was visited by LNK Group board chairman Artjoms Milovs. However, according to LNK Group, his visit was associated with the case related to the 2016 Island Bridge reconstruction case, not the recent cartel scandal.

LTV also noticed how the lawyer of the scandalous businessman Māris Martinsons arrived at KNAB office around noon. It is worth mentioning that the aforementioned gentleman is involved in multiple criminal processes. His lawyer did not say if he had arrived at the office of the law enforcement institution to defend his client.

Full article here


Moneyval report on Latvia may be changed no sooner than 2023

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European Council’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism Moneyval and Financial Action Task Force (FATF) may change their report on the situation in Latvia’s financial sector no sooner than 2023, said deputy state secretary to Interior Affairs Ministry’s and the prime minister’s work group’s vice-chairman Jānis Bekmanis at a meeting of Saeima’s Budget and Finance Committee’s Finance Sector’s Supervisory Sub-committee.

«It is important to understand that the report on Latvia will not be changed in February 2020. Moneyval and FATF gave Latvia a task that needs to be completed by 2023. February is the time when it will be decided if Latvia is working in the correct direction. If they conclude that we have accomplished nothing, the assessment will be reduced and Latvia will be added to the so-called grey list. If our accomplishments receive a positive score, we can expect recommendations on what we should do in the future,» explained Bekmanis.

He informed members of the Saeima that the first step to make Latvia compliant with FATF standards has been made.

«We received specific indications that of the 40 technical standards we are partially compliant with ten and almost compliant with 16. We are halfway – the technical report has been set to Moneyval secretariat. Now experts from Slovenia and Montenegro will report on Latvia’s accomplishments. We will maintain active communication with the secretariat to provide answers to questions they might have. Thanks to the work done by the government and the Saeima on enormous legislative acts, Latvia has requested its score to be upgraded by 20 recommendations,» said Bekmanis.

Full article here


Mayor Oļegs Burovs takes charge over Riga Freeport

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Mayor of Riga Oļegs Burovs

Riga’s Mayor Oļegs Burovs has been appointed as the new chairman of the board of Riga Freeport, as BNN was told by the freeport’s representatives.

Burovs promises to pay extra attention to economic affairs and the port’s already initiated infrastructure development projects in an effort to have the port develop at the same pace as the city.

«Riga Freeport has an inseparable part of Riga since the city’s very foundation and it remains one of its main economic pillars,» comments Burovs. «Our goal is managing the port in a way to secure the biggest possible social and financial contribution to the city, its residents and the country as a whole, while also maintaining environment protection requirements.»

Full article here


You go bankrupt – Estonian greens recommended to wind down

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The Estonian party funding watchdog has suggested the Estonian Green Party to go bankrupt seeing it has been unable recover from persistent and large debt.

Estonian public broadcaster ERR reported on Wednesday, September 4, that the party has been working with losses since 2010.

In October 2018, the Estonian Supervisory Committee on Party Financing (ERJK) issued the party with a precept ordering it to repay its long-term debts to creditors, on the grounds they are considered prohibited donations. The Greens challenged the injunction in court, but the latter upheld the ERJK’s decision in late June this year.

ERJK chair Liisa Oviir (SDE) commented that the large and increasing debt burden, estimated at 46,000 euros in the first half of 2019, illustrated the party is not financially viable.

Full article here


Lithuania U-turns on food voucher plan

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Lithuanian Minister of Agriculture Andrius Palionis

The Lithuanian Ministry of Agriculture has decided not to implement a government-planned food voucher programme to support families and retailers of local produce in the countryside. It believes funds could be spent more efficiently.

Lithuanian public broadcaster LRT reported on Wednesday, September 4, citing the ministry that the voucher programme, which was to be piloted next year and was aimed at supporting small businesses and families with small children, would cost the government up to 14 million euros.

The new Lithuanian Minister of Agriculture Andrius Palionis has previously criticised the scheme, saying the funds could be used more efficiently.

Food vouchers would have been part of the rural development programme. The Ministry of Agriculture has noted that it will continue with the programme’s goals: encouraging cooperation among farmers and sales of local produce.

Full article here


Latvia’s ruling coalition committed to finding compromise in budget planning

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Latvia’s Prime Minister Krišjānis Kariņš

Nothing in the next year’s budget formation process has been turned down yet. However, nothing has been provided with unanimous support either, journalists were told by Latvian Prime Minister Krišjānis Kariņš after a government meeting on Monday, 2 September.

The prime minister stressed that ruling parties continue their «interesting and equally complicated» work in the next three-year budget. «We are trying to be innovative – to look at not only the next year but also the next three years and how our decisions will influence the coming years,» the prime minister said.

Kariņš said the process is not simple, especially considering that each party has its own priorities. «On the one hand parties agree that this and that is important, but on the other hand – there is not enough money to afford everything,» he said, adding that politicians of the coalition are trying to discuss what the government should do to make the lives of residents better.

«We are not engaged in irresponsible activities, taking numbers without justifications. All partners have presented justified arguments, but the difficulty is with reaching a compromise. The process continues, and as long as there is no agreement on all important matters, individual tasks will not be outlined,» said Kariņš without revealing any agreements.

«We have not said any clear no or yes to any proposal so far,» said the prime minister. At the moment, coalition partners are actively discussing how much money it is possible to allocate for which activities. Coalition partners have different views on this.

Full article here


Fee for home delivery of pensions or benefits in Latvia to double next year

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From 2020 onward the fee charged by Latvian Post for home delivery of pension, benefit or remuneration paid by State Social Insurance Agency (VSAA) will be EUR 4.88, which is double of the current fee, whereas from 2021 onward this service will cost EUR 5.28, as journalists were told by VSAA director Inese Šmitiņa.

She said that Latvian Post won in the procurement of delivery services. Latvian Post was only the sole candidate.

«The contract is signed for two years – 2020 and 2021. It is important to inform people in advance, because some people may decide to opt out this option,» said Šmitiņa.

«The price of the service will be EUR 2.39 until the end of the year. Starting with 1 January 2019, however, it will increase to EUR 4.88. 2021 onward, however, it will increase even more – EUR 5.28,» she added.

According to VSAA, the number of pension, benefit and remuneration recipients in Latvia who choose to have money delivered to their home is currently rapidly declining. This has a significant effect on the service’s self-cost. For example, in 2013 pensions were delivered to the homes of 127 000 people in Latvia. In 2018 pensions were delivered to 85 000 people, whereas in the first months of 2019 pensions were delivered to 79 000 people, which is 14% of all pension recipients.

Full article here


Media suggests amount of «dirty money» in ABLV Bank may exceed one billion euros

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The possible amount of illegally obtained funds in ABLV Bank exceeds EUR 1 billion, according to Ir magazine.

This much was confirmed to Ir magazine by two independent and unrelated sources.

Since spring 2018, when ABLV Bank was closed, Latvian State Police has had a lot of work. Information related to this bank, its clients and employees is being analysed in close cooperation with Financial Intelligence Service.

«It is priority number one for us,» Ir magazine was told by State Police Economic Crimes Enforcement Office Chief Pēteris Bauska. His office is in the process of investigating eight criminal processes associated with ABLV Bank, but this may not be the end of it.

Several investigative groups have been composed. On top of that, we have founded a new form of cooperation this summer – once every couple of weeks representatives of police, prosecutor’s office and Financial Intelligence Service gather to discuss progress and future plans. Bauska did not comment on the matter in more detail. He did promise, however, «to do everything in our power and then some».

ABLV Bank still has not commenced repayment of deposits. This is because it is first necessary to determine the origin of said money. Unfortunately, institutions have yet to reach an agreement on the most appropriate methodology to check the origin of said money, Ir magazine notes.

Full article here


Valentīns Kokalis details secret talks held in Lembergs’ hunting lodge and backstage political puppetry

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Valentīns Kokalis

«Jurijs Bespalovs was one of the first to speak out against Aivars Lembergs. But he could not take the pressure. Falling to his knees, he begged to not be punished. Meanwhile Lembergs told us at one meeting – watch out so that it doesn’t happen to any of you! Who else could drop to their knees before me and cry?»

Once one of Lembergs’ trusted people, ex-prosecutor of Ventspils, once the vice-president of Ventspils Nafta, as well as board chairman of SIA LatRosTrans Valentīns Kokalis, who later decided to oppose the system formed against him, shares in an open conversation with journalist Simona Šjadīte information about the backstage of Lembergs’ politics, influence over State Revenue Service (SRS), and how the man accused of committing serious crimes had blasted Latvia’s prime ministers with curse words.

It should be said that the aforementioned Bespalovs, who was once a board member of Ventamonjaks, was a very important witness in Lembergs’ criminal case. He was supposed to testify on 5 April 2012, but this was not to be. He died of acute heart failure the day prior – 4 April.

Conversations at Lembergs’ hunting lodge – hard to list the people who hadn’t been there!

«After one of many Saeima elections Lembergs brought with him a sheet of paper with a list and named a quota – we need our own economy minister, who should be put? I told Aivars – you! He said – not me. Let’s put you, Valentīns. I tell him – I’m a lawyer, what can I do? I recommended Krists Skuja. He says – no, no. Who’s the economist at Ventamonjaks? Strujevičs. Oh, let’s put him. And so the officials were appointed,» Kokalis recalls the conversations held at Lembergs’ hunting lodge.

And so Laimonis Strujevičs served as Latvia’s Economy Minister between 4 May and 26 November 1998. His legal affairs advisor was Andris Bumbieris. The latter committed suicide later in 1998.

In 1998 Skuja was appointed president of Ventamonjaks. He died of heart failure in 2009. He was considered one of the coordinators of Lembergs’ «black» finances and a person who provided contacts with politicians.

Full article here

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