French prosecutor demands huge fine and jail time for Latvian bank boss

Take note – story published 7 years and 2 months ago

French prosecutors working on a case of alleged tax evasion on a massive scale via a Latvian bank have asked for a €90 million fine and substantial prison terms for bank executives.

According to France's 'Nord Littoral', prosecutors believe Rietumu Bank should be hit with the massive financial penalty for colluding with the company 'France Offshore' to illegally hide taxes from French authorities.

In addition, prosecutors are asking for a four-year jail term for Rietumu president Aleksandrs Pankovs and an eighteen-month jail term for the bank's Paris representative Sergejs Scuks.

Prosecutors are demanding a even-year jail term for the founder of France Offshore, Nadav Bensoussan.

Pankovs formerly sat on the board of the Association of Latvian commercial Banks until Rietumu announced is sudden withdrawal from the umbrella organization in 2016.

The head of Rietumu's legal department, Jaroslavs Zamullo, denied the bank had done anything wrong.

"The bank remains confident that the court will assess the facts objectively and impartially," Zamullo said. 

LSM has reported several times in the past about France Offshore and its activities. A video posted to YouTube showing clear links between France Offshore and Rietumu Bank caused quite a stir.

In 2015, Riietumu was fined €35,000 by Latvia's financial regulator, the Financial and Capital Markets Commission for "Violations of the provisions of the Law on the Prevention of Laundering the Proceeds from Criminal Activity (Money Laundering) and of Terrorist Financing... weaknesses in the internal control system –  deficiencies in customer due diligence and monitoring of exposures."

However, that relatively minor penalty pales into insignificance beside the €90 million being demanded by prosecutors who say the fraud was worth "at least" €700 million.

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