Wednesday, October 28, 2020

ECB governor accused of accepting bribe and paid holiday in Russia


Latvia’s central bank chief, who led the former Soviet republic into the euro, appeared in court on Monday accused of bribery in the first corruption trial of a European Central Bank governor.

Latvia’s public prosecutor has accused Ilmars Rimsevics, 54, of accepting the offer of a 500,000-euro bribe and taking a paid holiday in Russia.

Rimsevics’ trial is a landmark case for the 20-year-old euro currency bloc, which spans EU countries from Portugal to the three Baltic nations that neighbor Russia.

The case has tarnished the image of the ECB, where Rimsevics sits on the governing council, which decides the price of money in the euro zone and has the final say in supervising banks.

- Advertisement -

Rimsevics appeared in court alongside Latvian businessman Maris Martinsons, who prosecutors say acted as a middleman.

State prosecutor Viorika Jirgena said the central charge against Rimsevics was that he took a bribe. If convicted, he could face jail. Rimsevics denied the accusation, while Martinsons’ lawyer also denied the charges.

The case centers on allegations of a 500,000 euro bribe promised, and partly paid, by two shareholders of Trasta Komercbanka at a time when the Latvian bank was worried about its future.

Part of the evidence is based on conversations between the defendants in a sauna, secretly recorded by Latvian investigators.

- Advertisement -

Jirgena has earlier said the bribery dates back to 2010, when the shareholders paid for Rimsevics to spend a vacation in Kamchatka, a wilderness region in Russia’s far east.

In return, Jirgena said Rimsevics helped them prepare answers to questions from the Latvian regulator, the Financial and Capital Market Commission (FCMC).

Later, in 2012, the shareholders agreed to pay him 500,000 euros in two equal installments, in return for Rimsevics using his influence to soften treatment of the bank.

Lawyers for Rimsevics persuaded the judge on Monday to allow him travel to Frankfurt in December for what will be his final ECB Governing Council meeting before his term expires.

He had earlier been reinstated in that post after the ECB challenged his suspension from office. Rimsevics’ lawyers argued in court that his position with the ECB granted him immunity from such a prosecution.

The prosecutor alleges that Rimsevics was unsuccessful in preventing Trasta Komercbanka’s demise and that, as a result, the shareholders refused to pay the second 250,000-euro installment.

The bank closed in 2016 after the Latvian regulator said it had broken money-laundering rules.

The shareholders approached Latvian anti-corruption investigators, handing over evidence of the bribery.

As central bank governor, Rimsevics was entitled to attend meetings at the FCMC regulator and was also responsible, along with the finance ministry, for proposing its head.

A spokeswoman for the FCMC said it took decisions independently. The ECB declined to comment.

The stakes are high for Latvia. After securing independence from Russia in 1991, more than a dozen of its banks have promoted themselves as a gateway to Western markets for clients in former Soviet states, promising Swiss-style secrecy.

Its prime minister, Krisjanis Karins, has pledged to end that and promised to overhaul the banking sector but his efforts have been overshadowed by slow progress in the Rimsevics case. Rimsevics was originally detained in early 2018.

- Advertisement -


Beam Suntory Inc. fined $19.6 million in foreign bribery case

Beam Suntory Inc. (Beam), a Chicago-based company that produces and sells distilled beverages, has agreed to pay a criminal monetary penalty of $19,572,885 to...

Julius Baer to deny two former CEOs their bonuses over money laundering scandal

Julius Baer will withhold millions of francs in bonuses from its former chief executives Boris Collardi and Bernhard Hodler, as a result of a...

Goldman Sachs executives to cover part payments of $3 billion fines in 1MDB scandal

Nine current or former Goldman Sachs executives, including CEO David Solomon, will have to pay back hundreds of millions of dollars in compensation over...

Goldman Sachs agrees $3 billion settlement with US DoJ over 1MDB corruption scandal

Goldman Sachs has agreed to pay nearly $3bn (£2.3bn) in the US to end a probe of its role in Malaysia's 1MDB corruption scandal. The...

Hong Kong fines Goldman Sachs $350 million over 1MDB scandal

Goldman Sachs ignored multiple red flags over the multibillion-dollar fundraisings it arranged for state fund 1Malaysia Development Berhad, Hong Kong’s financial regulator said on...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World


Latest News

This Week

Berkshire Hathaway to pay $4.1m to settle Iran sanctions violation

Berkshire Hathaway Inc. has agreed to pay roughly $4.1 million to settle allegations that a Turkish subsidiary violated U.S. sanctions on Iran. The U.S. Treasury Department on...

UK regulators fine Goldman Sachs £97 million over 1MDB scandal

Goldman Sachs International has been fined £96.6m by UK regulators for risk management failures connected to the 1MDB scandal. The Financial Conduct Authority and Prudential...

EU takes legal action against Cyprus and Malta over investment for citizenship scheme

The European Union’s executive said on Tuesday it was launching legal action against Cyprus and Malta over their investor citizenship programmes, also known as...

Texas attorney general Ken Paxton fires top aide who accused him of bribery

Lacey Mase, one of the top aides who accused Texas Attorney General Ken Paxton of crimes including bribery and abuse of office, has been fired, she told The...

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks