The five - Swedbank, SEB bank, Norvik bank, Danske bank and the Reverta asset recovery agency - say they are "concerned about the slow pace with which the government is fulfilling promises to improve the legal environment".
Citing numerous major cases currently running through the courts, the five blast official indifference to "systematic abuse of the insolvency system" which they claim is causing losses worth €174m.
Even that sum could be "just the tip of the iceberg" they warn.
"In these cases, the abuse of insolvency and losses caused by fraudsters are equivalent to mortgage loans to about 5,000 new families or could build 10 medium-sized factories," the banks say.
In particularly pointed comments, the banks say they are "puzzled" by the blind eye that previous and current Ministers of Justice take to large-scale fraud, particularly as aspects of the cases constitute "a threat to national security."
"Both the financial system and the majority of companies who are considering investment in Latvia expect decisive action by law enforcement authorities and those responsible for the fair functioning of the judicial system," the letter says.
An accompanying table outlining what the banks claim are some of the most outrageous cases can be viewed here (in Latvian).