Ilmars Rimsevics, a member of the Governing Council of the ECB allegedly demanded up to 500,000 euros ($ 580,000) and a trip to the Far East of Russia as a bribe from a small lender, according to the Latvian prosecutor
Rimsevics refused to resign and denied all allegations against him, received half the amount in several cash payments over five years, prosecutor Viorika Jirgena told reporters in Riga on Friday, citing testimonies and evidence collected during the investigation. The Latvian authorities, now considering whether to bring the case to court, said the central bank governor helped Trasta Komercbanka answer questions in a regulatory investigation following a money laundering investigation.
"From 2010, when the trip went on until the end of 2015, the bank president helped Trasta Komercbanka's shareholders to prepare replies that they had to submit to banking supervision" on issues of the bank with liquidity and non-residences, according to Jirgena. Rimsevics never received the full amount of bribes because Trasta's problems persisted.
Rimsevics, who was temporarily imprisoned in February, may face an 11-year jail sentence for corruption in the eurozone's financial sector. The scandal included the closure of Latvia's third largest banks, US money laundering charges, allegations that the country's lenders had helped channel criminal money into the European Union and even imposed sanctions on North Korea.
Ex-Soviet Hub  The flood of banking scandals has caused Latvia to revise its financial industry, which had served as a regional hub for cash from the former Soviet Union since the collapse of communism. Rimsevics, as governor and previously deputy governor, has been overseeing the industry since 1992. His legal problems have robbed him of his seat at ECB policy meetings and he has been banned from traveling.
Latvia, where foreign deposits were once darkened on site savings, dismantling the so-called non-resident industry and banning the use of shell companies. The US, whose report on widespread money laundering violations has triggered the sinking of ABLV Bank AS, said the authorities would need to do more to cleanse the sector.
Prosecutors review all the evidence before deciding to bring the governor's case to court. The process could take "a few months" and could be resolved "by the fall or the end of the year," Jirgena said. The investigation has unearthed allegations including death threats, Russian interference and proposals for scoring positions among the Latvian elite.
In an interview with Latvian television on Thursday, Rimsevics denied any wrongdoing. Some of the alleged events took place five to eight years ago, he said. His lawyer has not been available since Thursday when the authorities said the governor will be prosecuted
The 53-year-old civil servant cuts an isolated figure in his Baltic homeland, with the president, government and parliament urging everyone to stop before his term ends in 2019. It is difficult to force it because of central bank independence laws.
The corruption case has strained relations between Latvia and the ECB, which has called into question some of the domestic restrictions on Rimsevics. Other ECB policymakers have encountered legal issues in the past. An ECB spokesman declined to comment.