Latvia’s chief banker arrested by anti-corruption officials

Germany's Central Bank governor Jens Weidmann (L) and Governor of Central Bank of Latvia Ilmars Rimsevics during hand shakes at Informal Meeting of Ministers for Economic and Financial Affairs (ECOFIN) in Riga, Latvia 25 April 2015. [EPA/VALDA KALNINA]

Anti-corruption authorities in Latvia have arrested the governor of the country’s central bank, Ilmars Rimsevics, the government said Sunday (18 February), while assuring there is “no sign of danger” to the financial system.

Rimsevics, who was appointed governor in 2001, was detained by officers from the Corruption Prevention Bureau (KNAB) on Saturday and questioned for seven hours before being taken to another location on Sunday, according to a journalist from the Baltic News Agency (BNS).

Local media said anti-corruption officers also raided the governor’s residence and his offices at the Bank of Latvia.

Latvian Prime Minister Maris Kucinskis confirmed the arrest but insisted there was “no sign of danger for the Latvian financial system”.

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“For now, neither I (as prime minister) nor any other official has any reason to interfere in the work of the KNAB. The office (KNAB) is working professionally,” Kucinskis told BNS, the Latvian news agency.

“When KNAB considers it possible to give additional information to the public, it will do so,” he added.

KNAB declined to comment and no reason was given for the arrest.

The anti-corruption bureau will make a comment “as soon as possible,” spokeswoman Laura Dusa said, giving no indication as to why Rimsevics had been arrested.

Finance Minister Dana Reizniece-Ozola said Rimsevics should step aside for the time being to protect the Baltic country’s reputation.

“Given that the governor of the central bank is a symbol for every country, I think that it would be sensible at this moment that Mr. Rimsevics, at least during the investigation, steps down,” Reizniece-Ozola told a news conference.

“Under the current circumstances… every day that Mr. Rimsevics remains in the post of governor of the central bank, the situation (for the reputation of Latvia’s financial system) substantially worsens,” she said.

As Latvia is part of the euro area, Rimsevics is also a member of main body of the European Central Bank (ECB), known as the Governing Council, composed of the 19 governors of the eurozone.

A spokesperson for the European Central Bank declined to comment on Rimsevics’ detention.

Latvia’s Economics Minister Arvils Aseradens, speaking on Radio Latvia, also said the governor should consider resigning.

The government is due to hold an emergency cabinet meeting on Monday.

Latvian President Raimonds Vejonis said on Twitter that he would meet the National Security Council to discuss the “situation in the banking sector”, without specifying a date.

LTV public television reported that businessman Maris Martinsons, who operates in the construction and credit industries, had also been arrested by KNAB.

Earlier this month The US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) took action against Latvia’s ABLV, one of the largest private banks in the Baltics, over concerns about money laundering and activities linked to North Korea’s weapons programme.

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