The Corruption Prevention and Combating Bureau (KNAB) has sent to the Prosecutor’s General Office for criminal prosecution materials of criminal proceedings regarding illegal activities of the "Latvenergo" AS officials alleging misuse of official position for purposes of acquiring property, passive bribery and laundering of criminally acquired assets on a large scale in organised group of persons during the period of time from 2006 until June 2010. Criminal proceedings were initiated on 14 June 2010.
KNAB investigator asks to start criminal prosecution against 17 persons in relation to bribery of „Latvenergo” AS officials in Pļaviņas HES and TEC-2 reconstruction projects implemented by the „Latvenergo”:
- for taking bribes – against four former „Latvenergo” AS public officials, two of them –for legalisation of illegally acquired assets;
- for giving bribes- against four official representatives of foreign companies;
- for legalisation of illegally acquired assets- against eight persons, among them against one person – also for repeated intermediary in bribery;
- for the support of intermediation in bribery- one person.
Evidences collected during pre-trial investigation show that „Latvenergo” AS officials and employees by using official position with the purpose of acquiring property in a group of persons pursuant to prior agreement accepted bribes in large amounts in order to ensure that decisions concerning public procurements and reconstruction works for „Latvenergo” AS are taken in the interests of companies registered in Spain, Turkey and Sweden.
Evidences gathered within the investigation give sufficient grounds to believe that bribes to „Latvenergo” AS officials were transferred by using consultancy agreements signed by the suspect’s in bribery intermediary companies and foreign companies submitting bids. Purpose of paying bribes was to ensure awarding of public procurement contracts, execution of these contracts and disclosure of related confidential information. Collected evidences are sufficient to conclude that bribery intermediary together with other persons was actually a manager of financial assets forwarded to „Latvenergo” AS officials.
Information at the KNAB disposal indicates that „Latvenergo” AS officials and the consultancy company owner in organised group in order to conceal illegal origin of acquired assets laundered proceeds of crime through different money transfers, real estate transactions and investments in companies owned by them.
In relation to the contract of TEC-2 for its first stage reconstruction works (178 million euros) the KNAB has noted that a bribe for a total of not less than 6 million was made in a number of payments through intermediate companies registered in many different countries from 2006 to June 2009. In regard to the Pļaviņas HES reconstruction works (32 million euros) the KNAB established that a bribe no less than 1 million was made from 2007 to May 2010. While in the case of a contract for the TEC-2 second stage reconstruction works (57 million U.S. dollars and 289 million euros) a bribe in amount of 1.1 million euros was transferred in May 2010. Due to arrests of several persons involved in bribery made by KNAB in June2010 most of the planned around 11 million bribe was not transferred.
In the course of pre-trial investigation 34 mutual legal assistance requests were sent to 14 countries. Further, in the framework of the criminal proceedings interrogation of persons and search of premises was carried out in several countries. In order to perform investigative activities assistance of experts from the European Anti-Fraud Office (OLAF) was provided and with the support of Eurojust cooperation was established with law enforcement representatives from EU countries and beyond.
As reported previously, part of the arrested funds in amount of 448 000 lats were already recognised as illegally acquired assets by the court decision based on the information provided by the KNAB and are to be confiscated. During the investigation led by the KNAB sufficient evidence was gathered proving that funds have a criminal origin and relation to the offense.
The KNAB states that no person shall be considered guilty until his guilt is proven by the court in accordance with the Law on Criminal Proceedings.