Five more arrested in Rīga lift scandal

Five employees of the Rīga municipal housing management company “Rīgas namu pārvaldnieks” (RNP) have been arrested in connection to the ongoing fraud investigation, according to the State Police on February 4.

Proceedings have begun for all five persons, including establishing their role in the criminal case. The investigation continues, and RNP has decided to undergo a comprehensive audit since criminal proceedings began in connection to a lift management contract. The audit will be outsourced.

“If there is even the smallest concern that RNP has become the victim of fraud as a result of the contract (lost money, overpaid for services), the company board's mission is to precisely establish the situation regarding this procurement,” said RNP Board Chair Ernests Saulītis.

RNP has also taken the additional steps of suspending two employees from their duties: Technical Department Director Edgars Akmens and Technical Department Electrical Systems Division Manager Andrejs Maļinovskis. Maļinovskis led the lift management acquisitions committee, while Akmens served as his deputy. RNP claims to have no knowledge of whether they have been arrested.

“If it's necessary to suspend ten, fifty, or even a hundred employees so that we can complete this task, it will be done,” said Saulītis.

RNP representative Krists Leiškalns said that it's yet unclear why some employees aren't showing up for work, and that they would welcome additional information from the police. He also said the company will wait until after the audit to decide whether to break the contract with the “Liftu alianse” lift management company owned by Igors Babkins, who has already been arrested in connection to the case.

"We're talking about a very large number of buildings with a very large number of lifts that regularly experience technical issues that need to be solved. If we determine any sort of fault, then we will decide how to act," said Leiškalns.

As previously reported, criminal proceedings, including conducting a company search on January 30, have begun against RNP in regards to suspected large-scale organized fraud and money laundering, and two people were detained, including the “Liftu alianse” company owner Igors Babkins, according to Latvian Television on January 31.

That search was conducted at RNP and “Liftu alianse” offices in Rīga by the State Police Economic Crimes Unit (ENAP) and evidence was taken, according to ENAP Chief Pēteris Bauska. He said the organized fraud and money laundering was possibly conducted by several companies that provide services for RNP.

At the end of last year Rīga Mayor Oļegs Burovs said that he is ready to speak to the Corruption Prevention and Combating Bureau (KNAB) about the 8.3 million euro RNP lift service procurement contract won by newly formed “Liftu alianse”.

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