Latvia's top banker detained in corruption probe

Associated Press

LONDON – Latvia’s top banking official, a key member of the European Central Bank, was detained Sunday after being questioned for hours by anti-corruption authorities amid accusations of bribery and money laundering in the European nation’s financial system.

Latvian state TV showed Ilmars Rimsevics arriving at the offices of the country’s anti-corruption agency Saturday night and leaving early Sunday, following what the broadcaster said was a raid on his office and property.

Prime Minister Maris Kucinskis confirmed that Rimsevics, 52, was being detained, but didn’t provide details. Neither Rimsevics nor his lawyer could be immediately reached for comment.

Rimsevics’ arrest is particularly sensitive because he sits on the top policymaking council of the ECB, Europe’s most powerful financial institution, and is privy to the state secrets of Latvia as well as those of NATO and the European Union.

During a news conference Sunday, Finance Minister Dana Reizniece-Ozola said Rimsevics “should resign from his post at least for the time of the investigation.”

The finance minister noted that the Latvian parliament cannot force Rimsevics out unless there is evidence of a crime, as the central bank is independent by law.

Reizniece-Ozola did not specify why Rimsevics was detained. However, she cited a U.S. Treasury report Tuesday that singled out a Latvian bank, ABLV, as a haven for money laundering that allegedly bribed local officials. She made no connection between the bank and Rimsevics.

The anti-corruption agency, the Bank of Latvia and the European Central Bank all declined to comment.

Any connections to money laundering, experts said, will raise concerns of the risk of blackmail from Russia, where the secret services and organized crime largely control the flow of illegal cross-border money transfers.

Latvia, one of the three Baltic nations that became independent after the 1991 collapse of the Soviet Union, has a well-documented history of acting as a money laundering funnel for Russian capital.

Its own banking system has been plagued by corruption and money laundering scandals in recent years. Among the most high-profile was the $230 million in Russian taxpayers’ money that was siphoned off by Russian officials, largely through Latvian banks, according to U.S. and European authorities.

Whistle-blower Sergei Magnitsky was imprisoned in Russia in 2008 and allegedly beaten and denied medical care, leading to his death. The U.S. and EU sanctioned Russian individuals over the case in December 2010.