European Central Bank puts onus on Latvia in graft probe
Feb. 22, 2018
RIGA, Latvia (AP) — The European Central Bank said Thursday it doesn't have the power to investigate money laundering in individual nations, a thinly veiled hint that it is up to member state Latvia to clear up its ongoing corruption scandal.
The ECB issued a statement saying that fighting money laundering is done by member countries. The ECB, it says, "doesn't have the investigative powers to uncover" any deficiencies in national governance.
Ilmars Rimsevics, who is Latvia's central bank chief and sits on the ECB's policymaking council, is being investigated in Latvia for suspected bribery. The Associated Press has further reported on accusations he is linked to money laundering from Russia.
The ECB, which is typically quick to defend its council members from pressure from national governments, has been silent about Rimsevics' case.
Meanwhile, U.S. Deputy Secretary of State John Sullivan visited Latvia Thursday to discuss security and economic issues with both President Raimonds Vejonis and Foreign Minister Edgars Rinkevics.
Sullivan was quizzed by journalists over a recent U.S. Treasury report that accused Latvian bank ABLV of actively laundering money and breaching North Korea sanctions.
He linked the report to Washington's wider concern over the Baltic nation both in terms of the economy as an euro-zone member and security as a NATO member.
"Money laundering is a concern to the United States as it affects a NATO ally in Latvia," Sullivan told reporters during a joint news conference with Rinkevics.
"It's a sanction that indicates the seriousness with which the United States takes money laundering," he said, referring to U.S. Treasury's restrictions set on ABLV Bank.
ABLV has denied the accusations but its finances apparently deteriorated since then, leading the ECB on Monday to prohibit the bank from making any payments.
ABLV needed a rescue loan from the Latvian central bank.
The bank, Latvia's third largest by assets, has 60 days to respond to U.S. authorities from the report's Feb. 13 publication.