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DE RUEHRA #0107/01 0441501
ZNY CCCCC ZZH
P 131501Z FEB 07
FM AMEMBASSY RIGA
TO RUEHC/SECSTATE WASHDC PRIORITY 3760
INFO RUEHSK/AMEMBASSY MINSK PRIORITY 0504
RUEHMO/AMEMBASSY MOSCOW PRIORITY 1174
RUEHTL/AMEMBASSY TALLINN PRIORITY 4012
RUEHSI/AMEMBASSY TBILISI PRIORITY 0114
RUEHVL/AMEMBASSY VILNIUS PRIORITY 3807

C O N F I D E N T I A L RIGA 000107 
 
SIPDIS 
 
NOFORN 
 
SIPDIS 
 
E.O. 12958: DECL: 02/14/2017 
TAGS: EAID KCRM LG PGOV
SUBJECT: SWINGING FOR THE FENCES: LATVIA'S ANTI-CORRUPTION 
BUREAU IN 2006 
 
 
Classified By: Pol/Econ Chief Waser for reasons 1.4 b. and d. 
 
 ¶1. (C) Summary:   At its annual briefing to the Riga 
diplomatic corps, Latvia's anti-corruption bureau (KNAB) 
highlighted 2006 as a year where it made great strides in 
tacking corruption.  Overall, the KNAB's successful 
completion of the cases for formal prosecution has 
dramatically increased from 27 cases in 2005 to 41 cases in 
¶2006.  Moreover, the KNAB is beginning to get at some of 
Latvia's "big fish," although difficulties still remain in 
investigating cases with possible links to organized crime. 
Alexis Loskotovs, Director of the KNAB, stressed to the 
diplomatic corps that the KNAB, though continuing to grow, is 
ready and capable of 'exporting' Latvia's experience. We 
agree that the KNAB can be a partner and mentor to other 
post-Soviet states looking to strengthen anti-corruption 
efforts. End Summary 
 
KNAB Summary of 2006 Activities 
 
¶2.  (SBU) Ambassador Bailey and PolOff attended the 
Diplomatic Corps briefing hosted by Latvia,s Anti-Corruption 
Bureau (KNAB) and conducted by Director Alexis Loskotovs. 
Loskotovs summarized the activities and success of the KNAB 
in fighting public corruption.  By the end of 2006, KNAB 
officials sent to the Prosecutor General (PG) for prosecution 
41 criminal cases involving 65 people, a significant increase 
from 2005 in which only 27 cases were passed to the PG. 
Fifty one additional cases of possible corruption were opened 
in 2006 but are still under investigation.  Loskotovs cited 
increased experience and skill level as the key factors in 
the KNAB,s success in sending more cases for prosecution. 
 
Noteworthy Cases 
 
¶3.  (U) Loskotovs highlighted a number of noteworthy cases 
from the year.  He paid special attention to the indictments 
of two judges in October: the head of Riga City Vidzeme 
district court and another lower ranking judge of the same 
court were alleged to have misused their offices for personal 
gain and taken bribes.  Both judges have been arrested and 
suspended from office, and are currently awaiting trial. 
 
¶4.  (U) Other important cases for 2006, according to 
Loskotovs, were: 
-- the prosecution of a former State Secretary and lawyer 
from the Ministry of Science and Education for involvement in 
a multi-million dollar real estate scam; 
-- the prosecution of the Mayor of Ventspils, Aivars 
Lembergs, and the Chairman of Ventspils Free Port Council for 
refusing an order from the Cabinet of Ministers and using 
office for personal gain; 
-- the prosecution of the head of the procurement commission 
of the Ministry of the Interior for bribery; 
-- the prosecution of a Riga City Council official for asking 
for and taking a bribe in regards to the privatization of 
some land; 
-- the arrest of the deputy state secretary of the Ministry 
of Science and Education for asking for and taking a bribe; 
-- the prosecution of the Executive Director of the 
Daugavpils City Council for arranging kickbacks in the 
procurement of oil products; 
-- and the prosecution of two officials of the Central Board 
of the State Border Guard of Latvia for taking bribes. 
At the end of 2006, all of these cases were in or awaiting 
trial. 
 
¶5. (U) The national elections which took place in October of 
2006 were the first since the KNAB,s creation in 2003.  As 
such, the KNAB was particularly focused on violations of the 
new campaign finance laws during the first nine months of the 
year.  The full results of their efforts during the elections 
will not be available until later this year but so far, 34 
incidences of illegal activity in the lead up to the October 
elections have resulted in fines to the parties. 
Additionally, the KNAB has a pending proposal before the 
Parliament, which, if passed, would toughen campaign finance 
laws by introducing administrative liability for donors to 
political parties for illegal donations and criminalize 
serious violations of campaign finance laws. 
 
The Future 
 
¶6.  (SBU) Asked by an attendee if he felt his job was secure, 
Loskotovs reported that he has recently met with the Prime 
Minister and feels optimistic that the KNAB will maintain its 
 
present independent status.  He added that in order for 
powers to be removed from the KNAB or to make any other 
change in its status, the constitution would have to be 
amended.  The KNAB has the most independent status possible 
in the present legal system, he said. 
 
¶7. (U) In addition to again making the case for Latvia,s 
membership in the OECD in order to benefit from the 
organization's anti-corruption and anti-bribery activities, 
Loskotovs pronounced the KNAB ready to be an exporter of 
experience and knowledge to transitional countries such as 
Georgia and Moldova.  The KNAB conducts annual training and 
education seminars for over 1000 Latvian public officials 
each year.  In 2006, 32 such seminars were held and included 
topics such as prevention of conflict of interest, 
professional ethics, assessing corruption risks, what is 
corruption, etc.  Additionally, the KNAB has produced and 
released a CD-ROM of interactive training material on Public 
Sector Ethics.  Loskatovs urged attendees to think of the 
KNAB when considering how to help other countries develop 
anti-corruption agencies or improve existing ones. 
 
¶8. (C) Comment: The KNAB has faced lingering criticism from 
the international community and local NGO's for its perceived 
inability to or avoidance of dealing with high level, deep 
rooted corruption.  Loskotovs takes this criticism seriously 
and has confided in PolOffin separate meetings that he 
depends on the support of the international community to 
bolster and support his position when dealing with difficult 
cases.  While we believe that the KNAB has made great strides 
in addressing public corruption among bureaucrats, 2006 was 
the first year it really went after high level officials such 
as mayors, judges and the most senior bureaucrats.  It 
remains to be seen how these cases will fare in the courts. 
Loskotovs has also expressed to us his view that corruption 
is closely linked to Organized Crime, which he admits the 
KNAB is ill equipped to handle adding that the KNAB often 
lacks the political support to deal with Organized Crime. 
Both Loskotovs and his deputy cite this as the reason why the 
KNAB has never addressed the issue of corruption at Riga Free 
Port.  While the KNAB still has room to grow and will benefit 
from continued US support and assistance, we do believe that 
it can be a useful partner for other former Soviet states 
looking to develop and strengthen their own anti-corruption 
efforts. 
 
BAILEY