bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Saturday 21.07.2018 | Name days: Meldra, Meldris, Melisa
LatviaLatvia

NP: Latvian banks involved in massive international money-laundering schemes; no one is punished

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThe European Union and entire organizations have been criticizing Latvia for its negligence to combat money laundering schemes over the course of the past fifteen years. Throughout this massive period of time, Latvian banks have been involved in enormous international money laundering schemes. Unfortunately, no one has been punished for that and dirty money continues flowing through the country, Nekā personīga reported on 14 May.

The programme reports that a group of experts from the European Council’s money laundering prevention office will arrive in Latvia in autumn to look at what was accomplished in the past several years. Only nine people were punished for money laundering in Latvia last year.

As noted by NP, Justice Ministry and responsible Saeima committees are currently rushing amendments to the law in order to change the definition of money laundering and expand the range of people that can be prosecuted for this crime. This could shake up statistics, but there are serious doubts about doing much to improve Latvia’s contribution to the fight against money launderers.

Latvian banks are famous not only for their good quality but also their services provided to international fraudsters. Money stolen from Russian officials – the so-called Magnitsky case, in which a billion was stolen from Moldova’s and Ukraine’s budget – all this money went through Latvia. Unfortunately, no one was punished for it, the programme reports.

Three years ago, Moldova was struck by a financial scandal, NP reminds. One billion euros had simply disappeared from three of the country’s largest banks in a span of one day. Investigation performed by international detective agency Kroll revealed that the banks were emptied by a local oligarch Ilan Shor.

Transactions were performed through Latvian Banks. The case mentions Aizkraukles Bank, Latvijas Pasta Bank and Privatbank. Accounts were opened in those banks to process transactions. Moldovan, Russian and Ukrainian residents were stated as beneficiaries.

Finance and Capital Market Commission punished Privatbank with the largest fine up until now. The bank and its management were fined EUR 2 million. The criminal process investigating possible crimes committed by the bank’s employees continues to this day, the programme reports.

«This was one of many money laundering schemes after which international organizations asked Latvia to strengthen its fight against such crimes, especially in international transactions,» NP journalists say.

Latvian investigators don’t have much luck with such investigations. Cases regarding money laundering are complicated. There is a deficit of qualified police officers to tackle such cases. Investigators need education in law and knowledge of investigative procedures, as well as good foreign language and economics skills. But there aren’t many investigators. People with appropriate education and skills are paid higher wages in the private sector than they are in the police force.

According to statistical data from the prosecutor’s office, 231 money laundering cases were registered in the Latvia in 2015 and 120 in 2016. Unfortunately, only 10% of such cases make it to court. Courts received 13 such cases in 2014, 6 in 2015 and only four in 2016. None of those criminal cases were about international crimes.

Moneyval work group will arrive in Latvia at the end of October to assess the country’s accomplishments in the past several years. Latvia’s laws comply with conventions, directives and declarations, but there are no tangible results from that.

Justice Ministry’s deputy state secretary Laila Medina comments on the matter the following way: «Although we see that money laundering combating efforts are one of the government’s main priorities, reality is rather harsh. Ten, maybe fewer, guilty verdicts were handed down in the past three years. This does not in any way reflect the estimates for the scale of money laundering activities in Latvia.»

Medina continues: «We believe it is necessary to change the definition of the term and simplify the work of law enforcement authorities to help them catch money launderers more efficiently. The hardest part of proving the fact of money laundering in court is the intention behind a suspect’s decision to hide the origin of the money in question.»

The ministry’s representative also notes that after the ministry’s amendments money laundering will apply to the same actions as before, except there will no longer be any difference in whose favour illegal activities were performed. The prosecutor’s office opposes the changes. The prosecutor’s office says changing the section on money laundering would expand the range of suspects against whom this section can be used. For example, money laundering section of the law would be applicable to situations when a person makes coffee using a stolen coffee machine or when a group of people drink a stolen bottle of vodka.

«Secondly, the crime would be considered committed the moment when a criminal gets his hands of the ‘goods’. This includes situations when a corrupt official takes the money home or transfers it to his account. Investigators will no longer have to look for the money in investments, properties registered on relatives’ names or other bribes. This will tempt investigators to stop deepening their investigations al the way,» Medina explains.

Prosecutor Juris Juriss comments the situation the following way: «We have to look at the goal and the core of international conventions and EU directives. What is their goal: stopping the inflow of dirty money into the financial system, prevention of financing of terrorism – all global and important goals. As I’ve said before – we need to focus on investigations of large cases.»

«The intention to hide or mask is what motivates investigators and law enforcement institutions to think about the ways money enters the financial system,» he says.

Justice Ministry’s developed amendments to the Law on the Prevention of Money Laundering and Terrorism Financing have been submitted to the Saeima. Other changes to the law are also proposed. The Saeima has even voted in favour of certain changes in two readings already. Defence, Internal Affairs and Corruption Prevention Committee’s deputies like proposals. The committee’s chairman Ainars Latkovskis is angry over the fact that the prosecutor’s office has noticed problems with already supported amendments, the programme reports.

Ainars Latkovskis told Nekā personīga: «I think there has been a clash of opinions. They are simply splitting hairs here. Your programme has emphasized it many times in the past that such cases are a rarity in Latvia. One of the biggest problems that were mentioned by experts is the law, specifically the requirement to prove the crime was committed intentionally, which is hard to prove. I think it is unnecessary – facts are enough to see dirty money is being laundered.»

«This particular section of the law makes it harder for police, prosecutors and court to punish criminals. I think it is absurd to split hairs, and this is why the committee has voted unanimously in favour of the ministry’s proposal. I am worried, however, that lawyers will start splitting hairs,» Latkovskis says.

The programme asked him: «Don’t you think it could be used to increase statistics?», and here responded by saying: «No, it’s absurd! Why would they apply this section – it’s about theft!»

Janis Baumanis, scientifically analytical advisor to the Supreme Court of Justice of the Republic of Latvia, told NP: «The Supreme Court has no objections against amendments submitted to the Saeima for the third reading. They have to be reviewed in the context of application of measures associated with it.»

He added: «Judges are concerned that significant proposals have been submitted for the third reading too quickly, and because of that there will not be debates about them. Arguments voiced by deputies during Saeima debates in the first and second reading are a tool courts can used if it is unclear how laws are to be applied in practice. This can be useful if amendments to the law in question come into force in Justice Ministry’s intended redaction.»

Ref: 225.109.109.6901


Leave a reply

SRS: cash register reform still stagnates, but has become much faster than it was last year

The cash registers reform continues stagnating. However, it has become much faster than it was a year ago, as reported by State Revenue Service.

Specialists to search for solutions to topical environmental problems in Ventspils

On Friday, 20 July, a meeting was held between Ventspils Commercial Port representatives and specialists from State Environment Service.

Children with functional disorders to receive services financed by EU funds

Child invalids will have access to social services intended to improve their social skills and mobility. More than EUR 4.2 million has been allocated for this goal from the European Social Fund, as confirmed by Latvia’s Central Financing and Contracting Agency.

Producer price level in industry up 4.3% in Latvia

Compared to June 2017, the average level of producer prices in Latvian industry increased by 4.3 % in June 2018. Prices of products sold on the domestic market rose by 4.8 % and those of exported products by 3.7 %.

Total tax debts in Latvia in July – 1.212 billion euros

At the beginning of July total tax debts in Latvia, including outstanding debts, halted debts and debts applied with repayment term extensions, accounted for EUR 1.212 billion, which is 0.8% less than a month prior, according to data from the State Revenue Service.

Survey: every third Latvian resident has received illegal loan offers

Nearly every third resident in Latvia or 31% of respondents admit having received offers to use illegal loan services, as concluded in a survey performed by Latvian Alternative Financial Services Association and SKDS.

Libya opposed to EU's idea to establish migrant centres in North Africa

Libya is against the solution of the European Union to set up migrant centres in the North African country as a means to keep migrants from arriving in the bloc and Libya would not be convinced with financial support, its Prime Minister Fayez al-Sarraj has noted.

Arrest warrant on Catalan ex-President cancelled by Spain

The Supreme Court of Spain cancelled a European arrest warrant for former Catalan regional leader Carles Puigdemont, as Germany refused to extradite him to face accusations of rebellion for declaring the independence of Spain's region, Catalonia in 2017.

Latvian government plans to allow handing expired food to charity

Latvia’s Agriculture Ministry has prepared amendments to the Law on the Supervision of the Handling of Food that provide permission to hand over certain types of food products to charity after the end of their expiry date.

Estonian industrial producer prices up 2.9% since June 2017

Estonian industrial producer price index has risen by 2.9% between June 2017 and the first summer month this year, resulting in an increase of export prices as well, Estonian statisticians have estimated.

Putin urges NATO to quit «irresponsibly» developing ties with Ukraine, Georgia

Russia's President Vladimir Putin cautioned NATO against developing deeper relations with Ukraine and Georgia, evaluating such a policy was irresponsible and would have consequences for the military alliance.

Latvian parliament not in a hurry to support president Vejonis for a second term

Political parties represented in the Saeima are not eager to support President Raimonds Vējonis for his remainder for a second term.

Weather in Latvia will remain warm and even hot at times

Weather in Latvia in the nearest couple of days will be dictated by a cyclone. Because of that the sky will be partially covered by clouds; thunderstorms are also expected, as reported by State Environment, Geology and Meteorology Centre.

Hungary sued in EU Court for criminalising help to illegal immigrants

The European Union's executive body has stated that a law in Hungary that criminalises support for illegal immigrants is in breach with EU law and Hungary has now been referred to the European Court of Justice for the alleged non-compliance.

Estonians buy alcohol in Latvia; country loses EUR 20 million in six months

Latvian stores located close to the Latvian-Estonian border have sold 1.6 million litres of strong alcoholic drinks in the first half year of 2019. This means Estonia has lost more than EUR 20 million in taxes, according to data from Association of Estonian Alcohol Producers and Importers.

Lithuania’s election watchdog slams ruling LFGU over popular TV series

Political messages can be channeled in various ways and the ruling now Lithuanian party, LFGU has chosen a very delicate way of the communications – through a TV series featuring the beauty and the ambiance of Naisiai, a picturesque settlement in Siauliai district.

Association: around 3,3000 people know of their HIV infection but receive no treatment

HIV remains a serious problem in Latvia – around 3,300 people are aware of their status but receive no treatment and continue spreading the infection. Because of that, it is necessary to act quickly for Latvia to lose its status as HIV kingdom and limit the spread of the infection, says Baltic HIV Association, informing decision-makers and responsible officials in institutions and hospitals about the HIV/AIDS situation.

Driver shortage may force reduction of international road haulage volumes

Latvia’s road haulage companies have started experiencing shortage of drivers. On top of that, if employment conditions for residents of non-EU member states do not change, it may be necessary to reduce the volume of road haulage volumes, says Latvijas auto president Valdis Trēziņš.

Lattelecom’s turnover up 9% in first half-year of 2018

Lattelecom Group’s turnover reached EUR 98.7 million in the first half-year of 2018, growing by 9% in comparison with the same period of 2017, according to unaudited financial results.

1,140 fewer births registered in Latvia in 2017

Since 2016 the number of births in Latvia is declining again. Compared to 2016, a total of 1,140 births fewer were registered in 2017. Also, the provisional number of births registered over the first six months of 2018 (9,664 children) is by 664 children smaller than that registered over the respective period of 2017.

Citadele Bank decides to reform Lithuanian subsidiary as a branch office

Citadele Bank has decided to reform its Lithuanian subsidiary as a branch office, as confirmed in the statement the bank submitted to Nasdaq Riga.

Russian pension age hike discussed amid protest outside Duma

As the Russian paliament votes on the proposal to gradually increase he pension age to 65 for men and 63 for women, some 200 people were seen protesting against the reform in Moscow.

Corruption watchdog chief says bureau has done no illegal actions

After going through Corruption Prevention and Combating Bureau’s past investigative activities, the bureau’s chief – Jēkabs Straume – found it confusing that officers often took no appropriate actions after acquiring evidence or receiving indications regarding necessary steps.

Illegal border crossings to Estonia on rise after Russia World Cup

Football fans with temporary residency permits of the Russia World Cup, or fan Ids, are trying to illegally cross the Russian border with Estonia, a member of the European Union.

Estonian 13-year-old lethally overdoses fentanyl

Estonian prosecutors have accused a 15-year old of negligent homicide after a girl, 13, passed away from fentanyl overdose.