Lielvarde Regional Council has dissociated itself from Abolins and his promissory note, but now, after analyzing the matter, the municipality believes that it may nevertheless be held liable for the document.
The city council's 2015 report says that the issuer of the promissory note could file a claim against the municipality. Likewise, the municipality's auditor has also concluded that this is possible, as did Inta Komisare, head of the Finance Ministry's Department Supervising Financial Operations of Municipalities.
Lielvarde Region Council officials and auditors visited the Finance Ministry Thursday to discuss the situation at the municipality, and were instructed to determine precisely what the municipality's liabilities could be regarding the promissory note - advice that would perhaps seem rather obvious and urgent to most people suspecting they might be asked to shell out €200m at some point.
Lielvarde is the only local government in Latvia this year whose annual report could not be audited, yet Lielvarde's possible obligations could also have a major impact on the state's consolidated financial report.
According to Lielvarde Region Council's report, former Lielvarde Mayor Abolins, in violation of the law and regulations on borrowing by municipalities, unilaterally signed a €200 million promissory note on behalf of the municipality in November 2015.
The municipality says in the report that the said amount, was not paid into any of the bank accounts of the local government last year, and that the municipality has done everything in its power to protect its interests - Abolins was fired, his actions were reported to the Prosecutor General's Office, Corruption Prevention Bureau, Finance Ministry, Environmental Protection and Regional Development Ministry, State Audit Office.
The municipality has no information whether Abolins has opened, in Lielvarde Region Council's name, accounts in banks outside Latvia, and whether €200 million has been paid into these accounts.
Independent auditors have concluded that it is impossible to state with authority that signing of the promissory note by then Lielvarde Mayor Abolins will not have any effect on the local government in the future. The municipality has not made provisions for the possible amount of obligations, which raises the question of the municipality's ability to continue work as per normal. Hence auditors have refused to issue their opinion about the local government's 2015 report.
As reported, Abolins resigned in December 2015 after Lielvarde Region Council asked the authorities to look into Abolins' actions.