ECB Governor Detained For Corruption

Back in May 2016, Lithuania central bank head, and ECB governing council member, Vitas Vasiliauskas said that contrary to widespread perceptions of central planners as clueless hack economists who would not survive one day in the private sector and who can only inflate asset bubbles, then watch them burst and replace them with even bigger asset bubbles, central bankers are really "magic people."

“Markets say the ECB is done, their box is empty,” Vasiliauskas told Bloomberg in the spring of 2016. "But we are magic people. Each time we take something and give to the markets -- a rabbit out of the hat."

It now turns out they also appear to be corrupt, criminal people because on Saturday, Vasiliauskas' next door peer, Latvian central bank Governor, Ilmars Rimsevics who is also a member of the European Central Bank’s governing council, was detained by Latvia's anti-graft bureau, prompting calls for him to step aside to prevent harming the country’s financial sector.

In a statement to Reuters, Latvia’s Prime Minister Maris Kucinskis did not say why Rimsevics had been detained or what he was being investigated for. However, he attempted to reassure people that the economy was stable.

Latvia's Central Bank governor Ilmars Rimsevics

Rimsevics, 52, has worked at the Baltic nation’s central bank since graduating with an MBA from Clarkson University in Potsdam, New York, in 1992. After first taking the role of deputy governor that year, he was promoted to governor in 2001. He’s been a member of the ECB governing council since 2014, when Latvia adopted the euro.

Hardly encouraging confidence, the statement said that “there are no indications that would suggest threats to the financial system of Latvia,” Kucinskis said, confirming that it is very likely that there are copious threats to the financial system of Latvia, whose central banker may soon be in prison for graft.

As a result, finance minister Dana Reizniece-Ozola said Rimsevics should step aside for the time being to protect the Baltic country’s reputation.

“Given that the governor of the central bank is a symbol for every country, [then] I think that it would be sensible at this moment that Mr. Rimsevics, at least during the investigation, steps down,” Reizniece-Ozola told a news conference.

“Under the current circumstances... every day that Mr. Rimsevics remains in the post of governor of the central bank, the situation (for the reputation of Latvia’s financial system) substantially worsens,” she said.

Latvia’s Economics Minister Arvils Aseradens, speaking on Radio Latvia, also said the governor should consider resigning. The home and office of the central bank’s governor were searched on Friday, the state broadcaster said on Saturday.

Meanwhile, Rimsevics’ lawyer told local media that the detention was unlawful. “A complaint is being prepared at the moment,” the lawyer, Saulvedis Varpins, told news agency LETA without elaborating. Varpins, who spent more than eight hours at the anti-graft bureau in Riga with Rimsevics before the governor was taken away in a bureau van, said his client was being held at the state police station and hasn’t been charged, according to Leta. Varpins, who didn’t answer repeated calls and text messages, cited the reason for the detention as alleged acts from years ago.

Reiznice-Ozola said the country was suffering a crisis of reputation over ABLV, which has denied all accusations from the U.S. Treasury and said it will work with U.S. officials and provide information so that doubts about it can be laid to rest. Latvia has asked the U.S. Treasury to discuss and share data on ABLV, she said. The central bank is helping the lender with liquidity, said Edvards Kusners, a member of the monetary authority’s board.

As Bloomberg adds, this is the latest setback for Latvia’s banking sector, which last week was hit by allegations by the U.S. Treasury Department’s Financial Crimes Enforcement Network that its third largest financial institution by assets, ABLV Bank, has institutionalised money laundering, claiming it helped entities allegedly linked to North Korea’s missile program process transactions -- charges the lender denies.

The ECB declined to comment, according to Bloomberg. Another ECB governing board member, Bank of Greece Governor Yannis Stournaras, is also being accused of bribery, an accusation he vehemently denies, alleging political persecution aimed at forcing him to resign.

Comments

BritBob Sun, 02/18/2018 - 10:59 Permalink

The European Central Bank is the central bank for the euro and administers monetary policy of the eurozone, which consists of 19 EU member states and is one of the largest currency areas in the world. It is one of the world's most important central banks and is one of the seven institutions of the European Union listed in the Treaty on European Union. The capital stock of the bank is owned by the central banks of all 28 EU member states.

BGO Sun, 02/18/2018 - 11:07 Permalink

Check out the last part... about Latvia institutionalizing money laundering... being contacted by the US Treasury. Maybe roughing up a punk CBer was the Treasury's way of warning Latvia to "stay out of [our] territory."

Ink Pusher Sun, 02/18/2018 - 11:24 Permalink

Where there's one cockroach, there are more cockroaches...

Don't be satisfied because we've managed to corner only one insect...

Diligence will be required to eradicate this planetary infestation...

SoDamnMad Sun, 02/18/2018 - 11:25 Permalink

So this guy is detained, interrogated, accused, hung out by the press and all the other bankers that helped Iran and slide by Russian sanctions get what... bigger bonuses?

Argos Sun, 02/18/2018 - 11:58 Permalink

OMG!  He went to my alma mater, Clarkson.  Back in

my day they only had STEM graduates.  They really should

have stuck to science and not dabbled in the Black Arts.

Sudden Debt Sun, 02/18/2018 - 12:07 Permalink

Shot in the neck.

Confiscation of all assets and all the assets of his family to the 3rd degree.

Anybody involved shall be met with the same penalty.

 

Fenix Mon, 02/19/2018 - 11:18 Permalink

I am form Latvia. This guy is famous for taking out mortgage at the peak of the real estate bubble in 2007 or beginning of 2008.

VIS MAIOR Mon, 02/19/2018 - 11:41 Permalink

latvia lithuania is leader )) in scandinavian prisons ..(yes over all domestic and imigrants) 

 corrupt nations on fall course ... as weird work with them No wonder this nations is Big friend with usa deep state or today military junta aka penisce madfakindog and trumpator