Latvia central bank chief SUSPENDED amid corruption investigation
- Author: Rogelio Becker Feb 21, 2018,
Feb 21, 2018, 4:22
Rimsevics, who was held in custody over the weekend, had earlier told a news conference he was the victim of a smear campaign because he has been leading a drive to clean up corruption in the banking sector.
The Associated Press reported that the chairman of local Latvian bank Norvik, Grigory Guselnikov, said Mr Rimsevics had asked for bribes since 2015.
In a bid to increase it's worldwide rating, Norvik last month hired former North Atlantic Treaty Organisation secretary-general, Anders Fogh Rasmussen, as deputy head of the bank's council. Then why would commercial banks try to attack him?
Under the classifications used by Latvian and European authorities, ABLV is classed as a systemically important bank.
The central banker also said he received a text message at the end of last month threatening that he would be shot, and informed law enforcement officials.
The bank's securities portfolio consists of Euro 1.5 billion worth of bonds or 99%, while the rest are shares and funds. "I have become the target of some Latvian commercial banks to destroy Latvia's reputation".
Guselnikov hit back at Rimsevics, who was deputy governor of the central bank from 1992 before taking over the helm in 2001. "For 25 years Rimsevics has been directing things". He was released on Friday on record bail of € 500,000 (US$ 620,000). The Bank of Latvia has lent just under 100 million euros against security bonds.
As governor, Rimsevics enjoys robust independence.
Finance Minister Dana Reizniece-Ozola said her country's reputation was suffering because of the scandals. Moreover, ABLV could continue to transact in other foreign currency so long as such activity does not involved correspondent accounts in the U.S. The fines followed a US investigation. Although ABLV is not a major player in the worldwide payment system, FinCEN noted that there may be some increased burden on us financial institutions to determine the indirect foreign correspondent relationships with Latvia, given that ABLV does not now hold any direct USA correspondent bank accounts.
Latvia's benchmark stock gauge, the OMX Riga Index, fell 0.1 percent to 1,021.337 on Tuesday after dropping 0.9 percent the day before.
"Norvik bank" was fined 1.3 million euro in July 2017 for incomplete due diligence and monitoring of the non-resident banking transactions which resulted in the circumvention of the worldwide sanctions against North Korea.
Latvia - a republic of around two million that joined the European Union in 2004 - has built itself into a banking centre for citizens from other former Soviet states.