Rīgas satiksme graft case: What we know so far

With Latvia's anti-graft watchdog having confirmed that this week's searches at the office and home of Rīga mayor Nils Ušakovs (Harmony) are in fact related to the ongoing corruption probe over rigged multi-million tenders in Rīga's municipal transport company, LSM presents a brief overview bringing together bits and pieces available about the case.

What is being investigated?

The Corruption Prevention and Combating Bureau (KNAB) is investigating possible corruption concerning three tenders, concluded from 2013 to 2016 and worth about €270 million altogether, issued by the Rīgas satiksme municipal transport company.

It is alleged that officials at the Rīga City Council and Rīgas satiksme received bribes from Czech and Polish companies to receive a favorable outcome in these tenders. 

Czech companies Škoda Transportation and Škoda Electric, as well as Poland's Solaris Bus&Coach won the tenders in question. These were related to selling buses, trolleys and trams to the Latvian capital. 

According to a KNAB announcement, private persons, as well as real and fictitious companies were used to transfer the bribes. 

LTV's investigative news show De Facto earlier reported that one version the investigators have is that about 5% of the tender sums may have been paid as bribes. This would mean that the tram purchase alone involved a bribe worth €3 million. 

How many people are involved in the case?

Through December, KNAB detained seven people in connection with the case. Five of them are still behind bars. Two people were detained in Poland by the country's Central Anti-Corruption Bureau.

The suspects in Latvia include high-profile businessman Māris Martinsons, as well as Vladislav Kozák, Sales Area Director at the Czech company Škoda Transportation. Leons Bemhens, former head of Rīgas satiksme, was the last to be arrested. Igors Volkinšteins, a Rīga City Council official responsible for tenders is likewise behind bars. 

De Facto has information that Martinsons in particular is suspected to have been the middleman in the bribery scheme.

Aleksandrs Krjačeks, a member of the Honor to Serve Rīga party, was released from custody in late December. His company Alkom Serviss partook in one of the three tenders together with Škoda Transportation. 

One Edgars Teterovskis is still behind bars, while his partner Elīna Kokina, who established the Tram Servis Rīga company together with Krjačeks and Kozak, was the only suspect who was not initially kept in custody.

Effects on Rīgas satiksme

The Rīgas satiksme board stepped down in response to the scandal, and a temporary one has been instated with Anrijs Matīss (Harmony) as temporary chairman.

Contracts are being cancelled. The proposed Skanste tram line has been pushed back for at least a year. There are worries that Rīgas satiksme, which is about €200m in debt, will have to refinance some of its loans due to the huge breach of trust. 

The new management has downscaled the company budget. In addition, Rīgas satiksme now wants to extract millions of euros in penalties over delayed deliveries from Škoda and Solaris. 

Political ripples

The greatest political casualty of the case has so far been former Rīga vice-mayor Andris Ameriks (Honor to Serve Rīga), who resigned after a disastrous television appearance in which reporters showed footage of Ameriks meeting Martinsons at a restaurant in Minsk. Ameriks nevertheless retains a lucrative post as board chairman at the Rīga Free Port.  

Outgoing Environment Minister -- the ministry also oversees municipalities -- Kaspars Gerhards (National Alliance) started pushing a bill to sack the Rīga City Council after being pressured to do so at a party congress. 

The new Environment Minister Juris Pūce (Development/For!), who was a vocal opposition councilor in Rīga before becoming a minister, says the bill is being revised and that stronger arguments are being sought for sacking the council. 

All but every major official, including the president, the outgoing PM, and indeed the new Environment Minister have called on mayor Ušakovs to resign, but Ušakovs does have a track record of paying absolutely no heed to such calls. 

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