As previously reported by LSM, a company called France Offshore and its formerly high-flying chairman, Nadan Bensoussan are at the center of a major scandal in France after it helped French citizens avoid paying millions of euros of tax over a period of several years.
On April 17 LTV's investigative show De Facto reported that Latvia's Rietumu banka itself as a corporate entity and one of the bank's individual directors Aleksandrs Pankovs are among the accused named in the case presented to French prosecutors and currently being prepared for trial.
According to information obtained by De Facto, the case involves at least fifteen potential plaintiffs with the French national financial crime investigation unit's deputy proecutor Ulrika Delaunay-Weiss confirming that Latvian names are among them.
"[Among] legal entities the investigating judge charged Rietumu bank, and Mr. Pankov, who was director, the leader of the bank in Latvia", Delaunay-Weiss said.
Specific charges include Pankov's failure to pay a €20m security bond that had been demanded by the French authorities while the investigation continued.
"The first [charge] is that the bank didn't pay the bail of 20 million. That's the first offence. And the second one is - as the vice-president of the bank, he helped in the money laundering."
Asked by De Facto if it was believed that Rietumu willingly collaborated with money laundering rather than doing so inadvertently, Delaunay-Weiss replied:
"That's the position of the investigating judge. That's why he charged them. He thinks because of different elements that the bank and some of responsible persons there knew that it was... how can I say ... a system of money laundering."
Until recently, Pankovs also sat on the board of the Association of Latvian commercial Banks until as reported by LSM, Rietumu announced is sudden and surprising withdrawal from the umbrella organization.
Despite taking action in recent weeks against two other banks in connection with alleged money laundering, Latvia's financial regulator, the Financial and Capital Markets Commission (FKTK) has yet to make public any recent sanctions against Rietumu and the bank itself has denied wrongdoing.
In a statement released April 15, Rietumu said it was willing to cooperate with French investigators and denied the €20 million bail had been applicable under Latvian law.
However in 2014 the bank did receive a warning from FKTK over its risk assessment practices and last year it was fined €35,000 for "Violations of the provisions of the Law on the Prevention of Laundering the Proceeds from Criminal Activity (Money Laundering) and of Terrorist Financing and FCMC regulations: weaknesses in the internal control system – deficiencies in customer due diligence and monitoring of exposures."
A handy English-language list of current penalties imposed by FKTK against all Latvian banks is HERE.