HELSINKI (AP) — Latvia's anti-corruption agency says it suspects the nation's central bank chief of demanding and receiving bribes of at least 100,000 euros ($125,000) and has started a criminal investigation against him.

The agency said Monday that no formal charges have so far been filed against Ilmars Rimsevics, who is also on the top policymaking council of the European Central Bank.

On Friday, the agency raided the office and a property of Rimsevics and detained him on Saturday.

Prime Minister Maris Kucinskis said after an extraordinary Cabinet meeting Monday that the central banker will face "restrictions" to be announced later.

He was quoted by the Baltic News Service as saying: "At the very minimum, he will be banned from continuing in office."

Rimsevics has served as Bank of Latvia's governor since 2001. Latvia joined the euro-zone in 2014.

Meanwhile, Latvia's financial regulator has ordered the crisis-struck ABLV Bank to cease all payments on the request of the European Central Bank amid U.S. accusations of money laundering and breaching sanctions on North Korea.

The ECB said Monday that the Financial and Capital Markets Commission of Latvia has imposed "a prohibition of all payments by ABLV Bank on its financial liabilities" until further notice.

The ECB noted that ABLV has seen a sharp deterioration of its financial position in recent days.

Latvia's central bank said separately that it would loan ABLV 97.5 million euros ($121 million) against "a reliable pledge of highly liquid securities" instead of 480 million euros ABLV had requested.

ABLV is Latvia's third largest bank by assets.

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.</s>The European Central Bank halted payments by ABLV, one of Latvia's biggest banks, on Monday, amid accusations from the United States Treasury that the lender had been involved in money laundering and unauthorised transactions with the heavily sanctioned nation of North Korea. The ECB said it had instructed Latvia's banking supervisor to impose a moratorium on the bank, freezing all payments by the bank on its liabilities. "In recent days, there has been a sharp deterioration of the bank's ...</s>LONDON — Latvia’s top banking official, a key member of the European Central Bank, has been accused by local bank Norvik of seeking kickbacks, trying to launder Russian money and retaliating against the bank when it refused to play by the “rules of the game.”

In a high-stakes drama for the tiny Baltic country, Ilmars Rimsevics was detained Saturday by Latvian anti-corruption authorities and questioned for hours into the night. State TV showed him walking free on Monday, without charges, though he is still being investigated for suspected bribery.

Norvik bank has filed an international legal complaint against Latvia in which it alleges that a “Senior Latvian Official” repeatedly sought “to extort monetary bribes,” and threatened the bank when its owner and chairman, Grigory Guselnikov, refused to pay up.

“The high-level official mentioned in our request for arbitration is Rimsevics,” Norvik’s CEO, Oliver Bramwell, told The Associated Press. Guselnikov confirmed that it was Rimsevics.

Rimsevics’ lawyer told Latvian TV that he promises to provide more information about the case on Tuesday. The ECB declined to comment on Rimsevics’ status.

The threat of criminal charges against the man who has been at the top of the country’s banking sector since 1992, in the wake of the Soviet collapse, has plunged the small Baltic nation into turmoil.

Rimsevics’ detention is particularly sensitive as he sits on the top policy-making council of the ECB, Europe’s most powerful financial institution, and is privy to the state secrets of Latvia, NATO and the European Union.

Any connections to money laundering would raise concerns of the risk of blackmail from Russia’s secret services or organized crime, and come at a time when Latvian security services warn that Russia is actively trying to obtain state secrets from Latvian officials to weaken the European Union and United States.

Guselnikov said he first met Rimsevics in 2015 after he was introduced to a man called Renars Kokins, who was said to know the country’s legal and political landscape well. Kokins invited Guselnikov to a meeting in a large villa in the suburbs of the capital. Soon after Guselnikov got there, another man arrived, on foot, and entered without knocking: it was Rimsevics.

He was brief and to the point. He told Guselnikov he could help him because the nation’s financial regulator was loyal to him personally. All he had to do was “co-operate” with Kokins, Guselnikov recalled.

Rimsevics left 10 minutes later and Kokins sat Guselnikov down at a table. He pulled a pen out and wrote on a piece of paper: “100,000 per month.”

Kokins did not use the word “payment.” He explained to the banker that all Latvian banks “co-operate” in this manner, Guselnikov says.

In the following weeks, Guselnikov tried to stall but found that every time he refused to pay, his bank would get hit with new regulatory measures.

Kokins did not relent, finding Guselnikov repeatedly after that.

Guselnikov says he met with Kokins and Rimsevics a few more times to try to clarify his position. Rimsevics took great care to not be seen at these meetings, Guselnikov says.

On one occasion, Kokins drove Guselnikov around the capital, Riga, for almost two hours before parking in front of a Chinese restaurant in the city outskirts. Kokins left the car and minutes later, Rimsevics entered it and sat behind Guselnikov, in the back seat, to speak, Guselnikov said. Another time they met in the restaurant itself, when it was completely empty.

“It was a nightmare for me for years,” said Guselnikov, who is 41. “You can’t understand how to get out of this dirty environment without reputation damage. That is why I decided to go out publicly and legally with my case. I can lose the bank, my money, but I will never become part of it.”

Latvia has become infamous for money laundering since the high-profile Magnitsky scandal, in which $230 million in Russian taxpayers’ money was siphoned off, largely through Latvian banks, according to U.S. and European authorities. Whistleblower 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 2014, a trove of leaked documents, the so-called Laundromat reports by the Organized Crime and Corruption Reporting Project, detailed how $20 billion was sent from Russia, largely through Latvia, in 2010-2014.

Latvian banks then went through an independent audit last year, after which Latvian regulators levied fines against three banks for a total of 640,000 euros.

One week later, France fined Latvian bank Rietumu 80 million euros for money laundering. Major global banks, meanwhile, have stopped making dollar transactions with Latvian banks after the Laundromat’s leaked documents illustrated how dirty money had reached firms like Deutsche Bank by way of Latvian banks.

Last week, the U.S. Treasury singled out one of Latvia’s biggest banks, ABLV, for having “institutionalized money laundering,” and the ECB on Monday blocked ABLV from making payments amid concerns about its finances. That forced ABLV to need a 97.5 million-euro ($121 million) loan from the Latvian central bank to stay afloat and keep the country’s financial system secure.

All of this happened on the watch of Rimsevics, who became chairman of the Bank of Latvia in 1992 after attending college in New York state, and then governor, the top policymaking role, in 2001.</s>Why did this happen?

Please make sure your browser supports JavaScript and cookies and that you are not blocking them from loading. For more information you can review our Terms of Service and Cookie Policy.</s>HELSINKI — Latvia's financial regulator has ordered the crisis-struck ABLV Bank to cease all payments on the request of the European Central Bank amid U.S. accusations of money laundering and breaching sanctions on North Korea.

The ECB said Monday that the Financial and Capital Markets Commission of Latvia has imposed "a prohibition of all payments by ABLV Bank on its financial liabilities" until further notice.

The ECB noted that ABLV has seen a sharp deterioration of its financial position in recent days

Latvia's central bank said separately that it would loan ABLV 97.5 million euros ($121 million) against "a reliable pledge of highly liquid securities" instead of 480 million euros ABLV had requested.

ABLV is Latvia's third largest bank by assets.</s>RIGA, Feb 19 (Reuters) - Latvia's third-biggest bank sought emergency financial support on Monday after U.S. officials accused it of helping breach North Korean sanctions, hours after the central bank governor was arrested over separate bribery allegations.

The financial sector in Latvia, a small euro zone state that shares a border with Russia, has come under wider scrutiny for being a conduit for illicit financial activities.

ABLV Bank was ordered by the European Central Bank to stop all payments as its liquidity position had deteriorated sharply since the U.S. Treasury accused it of allowing clients to conduct business with North Korea.

The Treasury's Financial Crimes Enforcement Network (FCEN) said bank executives and management had bribed Latvian officials to cover up their activities.

"ABLV has institutionalized money laundering as a pillar of the bank´s business practices," the FCEN said in a statement linking some of the alleged activities to North Korea's ballistic missiles program.

The bank has said the U.S. accusations were based on unfounded and misleading information.

The Latvian central bank said it had agreed to provide 97.5 million euros worth of funding to ABLV but the bank had yet to receive the money.

ABLV said it had ample collateral so was not seeking a bailout, just temporary liquidity support.

The bank will hold a news conference at 1500 GMT.

The economy in Latvia, which gained independence from the Soviet Union in 1991, has boomed in recent years. Its commercial banking sector is dominated by Nordic banks alongside a number of privately-owned local lenders.

In its document detailing the allegations against ABLV, the FCEN said the reliance of the Latvian banking system on non-resident deposits for capital exposed it to increased illicit finance risk. It said such deposits amounted to roughly $13 billion.

"Non-resident banking in Latvia allows offshore companies, including shell companies, to hold accounts and transact through Latvian banks," it said, adding criminal groups and corrupt officials may use such schemes to hide true beneficiaries or create fraudulent business transactions.

"(Former Soviet Union) actors often transfer their capital via Latvia, frequently through complex and interconnected legal structures, to various banking locales in order to reduce scrutiny of transactions and lower the transactions' risk rating."

In a separate development, Latvia's anti-corruption authority said it had detained central bank governor Ilmars Rimsevics, an ECB policymaker, over the weekend for demanding a bribe.

It said its investigation was not connected to the probe into ABLV.

"(Rimsevics' arrest)... is about demanding a bribe of no less than 100,000 euros," Jekabs Straume, the head of Latvia's Corruption Prevention and Combating Bureau told reporters at a news conference.

Rimsevics' lawyer said the central bank governor rejected the allegations made by the anti-corruption authority.

"But they (the allegations) have been expressed only orally, so we have not seen a specific document at the moment," Saulvedis Varpins said.

Neither the police nor the anti-corruption authority gave details of the alleged request for a bribe.

Latvia's government increased pressure on the central bank boss to quit.

"I can't imagine that a governor of the Bank of Latvia detained over such a serious accusation could work," Prime Minister Maris Kucinskis said on Monday.

After joining the European Union in 2003, Latvia adopted the euro as its currency at the start of 2014, a move which gave its central bank governor a seat on the currency bloc's top policymaking council.

Rimsevics was arrested on Saturday after police searched his office and home. He can be held for 48 hours, a period which is due to expire late on Monday.

The European Commission said on Monday that Rimsevics' detention was a matter for Latvian authorities. (Reporting by Gederts Gelzis in RIGA and Balazs Koranyi in FRANKFURT; Additional reporting by Simon Johnson in STOCKHOLM, Silvia Aloisi in LONDON and Jan Strupczewski and Alissa de Carbonne in BRUSSELS; Editing by Toby Chopra)</s>Latvia's central-bank chief has been released from custody on bail hours after the Baltic country's anticorruption agency accused him of receiving at least 100,000 euros ($125,000) in bribes.

The Corruption Prevention and Combating Bureau (KNAB) said on February 19 that no formal charges had been filed against Bank of Latvia Governor Ilmars Rimsevics, who was detained by police over the weekend.

Hours after the statement, the Delfi news portal showed video of Rimsevics leaving KNAB premises in Riga with his lawyer.

"I categorically disagree with [the charges]," Rimsevics said in the video to reporters at the scene.

Despite the denial of wrongdoing, Prime Minister Maris Kucinskis has called on Rimsevics to recuse himself from his duties while a criminal investigation against him is carried out.

Rimsevics has held the post since 2001 and is also a member of the European Central Bank's (ECB) governing council.

Latvia is a European Union member and uses the euro as its currency.

KNAB did not elaborate on the charges against Rimsevics, but AP reported on February 19 that executives at Latvian bank Norvik said the central-bank chief sought to extort money from their firm for years.

According to the news agency, Norvik has filed an international complaint against Latvia in which it claims a "senior Latvian official" sought bribes from the bank and abused his power. Norvik's CEO, Oliver Bramwell, told AP, "The high-level official mentioned in our request for arbitration is Rimsevics."

Latvia's financial sector is in upheaval with the investigation and a crisis at ABLV Bank, the country's third-largest bank by assets.

Latvia's financial regulator has ordered the bank to cease all payments after its liquidity position deteriorated sharply amid U.S. accusations of money laundering and breaching sanctions aimed at thwarting North Korea's weapons program.

The Treasury Department said in a statement last week that ABLV also facilitated transactions linked to "large-scale illicit activity connected to Azerbaijan, Russia, and Ukraine."

To shore up ABLV's finances, the central bank has said that it will loan the bank 97.5 million euros ($121 million) against "a reliable pledge of highly liquid securities."

With reporting by AP, Reuters, and Bloomberg</s>LONDON — The Latest on the bribery investigation on the Latvian central bank chief (all times local):

Latvian state TV reports that the country’s central bank chief has been released from detention on bail pending an investigation into suspected bribery.

The channel showed Ilmars Rimsevics speaking to reporters Monday evening and saying that he “rejects everything” that has been alleged about him. An Associated Press investigation found that a Latvian bank is accusing Rimsevics of seeking bribes for years, abusing his power and being connected to individuals involved in money laundering from Russia.

Rimsevics was detained on Saturday evening after questioned by Latvia’s anti-corruption authorities.

The state TV quoted Rimsevics’ lawyer, Saulvedis Varpins, as saying that more information on the case will be provided Tuesday.

Executives at Latvian bank Norvik say the nation’s central bank chief, who was detained Saturday without charges, sought to extort money from their firm for years.

Latvia Central bank chief Ilmars Rimsevics faces a criminal investigation for bribery but is not charged so far.

Norvik has filed an international complaint against Latvia in which it claims a “Senior Latvian Official” sought bribes from the bank and abused his power. Norvik’s CEO, Oliver Bramwell, told The Associated Press: “The high-level official mentioned in our request for arbitration is Rimsevics.”

Norvik’s chairman, Grigory Guselnikov, also told the AP how individuals connected to Rimsevics had asked his bank to launder money from Russia.

Rimsevics is also on the highest policymaking council of the European Central Bank, which sets monetary policy for the 19 euro countries.</s>The European Central Bank (ECB) stopped all payments by one of Latvia's largest lenders on Monday, after its liquidity position collapsed in the wake of allegations from U.S. authorities.



The ECB requested Latvia's banking supervisor impose a moratorium on ABLV bank, the small Baltic nation's third-largest lender, in order to freeze all payments by the bank on its liabilities.

"In recent days, there has been a sharp deterioration of the bank's financial position," the ECB said in a statement Monday.

"A moratorium was considered necessary given that the bank is working with the Latvian central bank and authorities to address the current situation."</s>RIGA, Feb 18 (Reuters) - Latvia’s central bank Governor Ilmars Rimsevics should step down while he is under investigation by the country’s anti-corruption agency, its finance minister said on Sunday.

Prime Minister Maris Kucinskis said earlier on Sunday that Rimsevics, who is a member of the European Central Bank’s Governing Council, had been detained by the anti-corruption agency.

“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 press conference, without offering any details as to why the governor was detained or what he was being investigated for.

The governor’s home and office were searched on Friday, Latvian media reported. (Reporting by Gederts Gelzis, writing by Johan Ahlander; Editing by Susan Fenton)
Latvia will ask the European Central Bank not to renew the mandate of ECB Governing Council member Ilmārs Rimšēvičs, the head of the central Bank of Latvia since 2001, amid an ECB payment moratorium and an U.S. graft investigation into Latvia's third-largest lender, ABLV. On 19 January, Rimšēvičs was released on bail.