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DE RUEHRA #0486/01 2731452
ZNR UUUUU ZZH
R 301452Z SEP 09
FM AMEMBASSY RIGA
TO RUEHC/SECSTATE WASHDC 6062
RUEHPNH/NVC PORTSMOUTH 0022
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHTL/AMEMBASSY TALLINN 0010
RUEHVL/AMEMBASSY VILNIUS 4063
RUEHWR/AMEMBASSY WARSAW 1104
RUEHFT/AMCONSUL FRANKFURT 2661

UNCLAS SECTION 01 OF 08 RIGA 000486 
 
SIPDIS 
 
DEPT FOR CA/FPP 
DHS FOR CIS/FDNS 
 
FRANKFURT FOR RCO, KERRY L. BROUGHAM 
 
E.O. 12958: N/A 
TAGS: KFRD CVIS CPAS CMGT ASEC LG
 
SUBJECT: LATVIA FRAUD SUMMARY: MARCH 2009 Q AUGUST 2009 
 
REF: (A) STATE 057623; (B) RIGA 170; (C) RIGA 472; (D) RIGA 90; (E) 
RIGA 165; 
(F) RIGA 359; (G) 08 RIGA 628; (H) 08 RIGA 692 
 
Per reftel A, Post has prepared its semi-annual fraud report for the 
period 
between March and August, 2009.  Please replace prior version of 
post's fraud 
report (reftel B) with the following text: 
 
¶A. COUNTRY CONDITIONS 
 
Latvia is a member of the EU and NATO.  Until 2008, Latvia's economy 
was one 
of the fastest-growing in the region, posting double-digit growth 
rates in 
real GDP.  However, the country is currently mired in economic 
crisis, with 
soaring unemployment rates, falling real property values, a 
tightened credit 
market, and a sizeable national deficit.  In fact, the Latvian 
economy 
contracted over the last 12 months, posting a GDP decline of 18.7 
percent in 
the 2nd quarter of 2009, calculated on a year-over-year basis (GOL 
Central 
Statistical Bureau).  In light of these difficulties, the Government 
of Latvia 
(GOL) is struggling with very difficult choices as its leaders seek 
to reduce 
the annual deficit in accordance with existing agreements with 
LatviaQs 
creditors (e.g. International Monetary Fund, European Union, et 
al.). 
 
Over the past several years, Latvia experienced significant labor 
force 
migration to other EU countries, most notably Ireland, Great 
Britain, and 
Germany (GOL Central Statistical Bureau).  The increasing official 
unemployment rate Q which measured 12.3 percent in August, 2009 (GOL 
State 
Employment Agency data) - is expected to motivate even more people 
to look for 
jobs abroad.  The August index reflects an increase of 2.8 
percentage points 
since February and 7.1 percentage points compared to August, 2008. 
This loss 
of jobs has been widespread: while the eastern part of Latvia 
(Latgale) has 
been especially hard hit (current unemployment rate is between 18-26 
percent, 
except for Daugavpils district with 12.1 percent), the current index 
is above 
10 percent in all regions of Latvia.  The European harmonized 
unemployment 
rate for Latvia was 17.4 percent in July 2009, the second highest 
rate in the 
European Union. 
 
Of those without work, almost half (45 percent per GOL State 
Employment Agency 
data) have general secondary education, 37.7 percent have 
professional 
education, and 14.1 percent have higher education, the rest have 
elemetary 
school education or their education level is unknown.  Construction 
and real 
estate, two of the most robust industries of the last few years, 
have been 
among the hardest-hit sectors.  Demographic studies provided by the 
GOL 
Central Statistical Bureau indicate that the jobless rate is highest 
(30.5 
percent) for men and women in their early twenties. 
 
According to data from the same source, the average net salary in 
the Latvian 
public sector dropped 10 percent between June, 2008, and June, 2009. 
Due to 
the widening national deficit, GOL ordered significant salary cuts 
 
RIGA 00000486  002 OF 008 
 
 
across the 
board for all government agencies, including local municipalities 
and their 
subordinate agencies. Further cuts may be expected in the coming 
months. 
Average net salary in the private sector remains the same as in 
¶2008. 
 
Actual average net salaries in the outlying regions ranged from 271 
to 313 LVL 
(or 565 to 661 USD, per current ROE) per month in June, 2009. The 
average 
monthly net salary was higher in Riga Q 408 LVL (or 841 USD, per 
current ROE). 
By comparison, the estimated minimum cost of living (poverty wage) 
in Latvia 
in June, 2009, was 168 LVL (or 344 USD, per current ROE). As a 
result, 
QunofficialQ wages grew in popularity in Latvia as entities and 
individuals 
tried to evade paying social and income taxes, which increase 
employer salary 
expenses by up to 50 percent. 
 
Latvia is essentially a bilingual country consisting of a Latvian 
majority and 
a Russian-speaking minority.  The relations between the two are 
sometimes 
strained.  According to statistical data, about 82.3 percent of 2.26 
million 
Latvian residents hold Latvian citizenship, whereas 15.5 percent are 
Latvian 
non-citizens. The remaining 2.2 percent of the population are third 
country 
nationals (TCNs) holding Latvian residency permits.  Of this latter 
category, 
the majority are Russian citizens. While Latvian non-citizens hold 
GOL-issued 
passports, their non-citizen status limits them from exercising some 
rights, 
for example, voting. A significant number of non-citizens do not 
speak 
Latvian, the country's official state language, which restricts 
their 
employment opportunities and ability to naturalize.  Latvian 
non-citizen 
passport holders are authorized to travel without a visa to Schengen 
countries 
for a stay of up to 90 days, but are not eligible for the U.S. Visa 
Waiver 
Program. The U.S. visa reciprocity schedule is the same for Latvian 
citizens 
and non-citizens. 
 
Over the last few years, many business sectors in Latvia experienced 
shortages 
in skilled and unskilled labor.  In response, the number of 
residency permits 
and work permits issued by GOL kept increasing over the last few 
years. 
According to GOL State Employment Agency data, the majority of TCNs 
employed 
in Latvia are from Ukraine (about 40 percent of the total of 
employed TCNs), 
Moldova, Uzbekistan, Russia, Thailand, and Belarus.  Most of these 
individuals 
are employed in the construction, manufacturing, transportation, and 
 
hospitality industries. 
 
¶B. NIV FRAUD 
 
NIV fraud is low in Riga. Wide-ranging fraud schemes are rarely 
encountered. 
In some cases, visa applicants present bogus employment documents to 
establish 
their bona fides, or omit information about their criminal records. 
Post has 
not yet encountered attempts from NIV applicants to falsify Police 
Clearance 
Letters. Post continues to perform document checks in conjunction 
 
RIGA 00000486  003 OF 008 
 
 
with all NIV 
cases.  The number of cases involving fraudulent documents has not 
increased 
during this reporting period. 
 
Latvian law enforcement institutions are working to combat organized 
crime 
groups, money laundering, and trafficking-in-persons schemes. 
Recent cost- 
cutting measures by GOL have affected the work of these 
institutions. 
 
Latvia joined the Visa Waiver Program on November 17, 2008. This has 
resulted 
in a considerable decrease in the number of NIV applications at 
Post. More 
specifically, Post processed 2,383 NIV applications between March 
and August 
of 2009, representing a 50 percent decrease compared to the same 
time period 
in 2008. The refusal rate (excluding G refusals) during the 
reporting period 
was 5.28 percent. Over the same reporting period last year, the 
refusal rate 
was 5.52 percent. According to post's annual B1/B2 visa validation 
survey, the 
visa misuse rate remains very low. The latest validation study 
indicated a 1.6 
percent misuse rate for visa holders issued by post between June, 
2007, and 
June, 2008 (see reftel E). 
 
Of the NIVs issued by Post from March until August, 2009, about 60 
percent 
were C1/D visas. In absolute numbers, the number of applications for 
C1/D 
visas has increased approximately 30 percent, measured 
year-over-year (from 
925 applications to 1204). C1/D visa fraud is rare and the refusal 
rate 
remains very low (0.16 percent). Post has established good 
cooperation with 
local crewing agencies. Previous validation surveys showed a 100 
percent visa 
compliance rate for sailors (see reftel F). 
 
Post issued 139 J1 visas between March and August of 2009, 
representing a 4 
percent increase over the same reporting period one year before. 
Almost all 
applications were from qualified applicants, with the exception of 
two Summer 
Work & Travel (SWT) applicants.  Post requested additional 
information from 
these individuals, but they never returned. The 2008 SWT visa 
validation study 
(see reftel G) showed a 100 percent visa compliance rate. The 
updated 
validation study for this category will be performed at the end of 
October, 
¶2009. The last survey on Au-pair program participants revealed 2 
instances (7 
percent) wherein visa holders overstayed the authorized period of 
stay (see 
reftel H). Because of worsening economic situations, J1 visa fraud 
remains an 
area of concern. 
 
Post does not process a high number of visas in other NIV 
categories.  Fraud 
cases involving other types of visas tend to mirror similar schemes 
being 
tried at multiple posts in the region. For example, post has noticed 
that the 
limited number of H1B visas issued to fashion models has led several 
U.S. 
agencies to try using the B1 visa category to facilitate paid work 
in the U.S. 
In these cases, the model typically says he or she intends to "meet 
with 
fashion photographers" - while the actual plan is to appear in 
 
RIGA 00000486  004 OF 008 
 
 
fashion shoots 
and runway shows.  Similarly, Post has recently received 
applications from a 
number of professional minor league hockey players, who request B1 
visas for 
their try out, but readily disclose their intention to work during 
their 
travel should they make the team. 
 
¶C. IV FRAUD 
 
Post has no IV fraud to report. In October, 2007, post began 
processing 
immigrant visas for children adopted from Latvia.  Warsaw processes 
all other 
immigrant visa categories for residents of Latvia. Upon request, FPU 
in Riga 
assists Warsaw in verifying authenticity of documents and other 
information 
submitted by the applicants.  Post has requested authorization from 
the 
Department to begin processing all categories of immigrant visas 
during fiscal 
year 2010. 
 
¶D. DV FRAUD 
 
Warsaw adjudicates immigrant visas for Latvian Diversity Visa cases. 
Post 
receives many DV-related inquiries from individuals who have 
received e-mails 
or phone calls from third parties. Post generally forwards these 
e-mails to 
RSO and FPU KCC as well. These letters often contain the Department 
of State 
logo, presumably copied from Internet resources. A warning message 
about DV 
fraud is displayed on postQs website. 
 
¶E. ACS FRAUD 
 
Post has no ACS or passport fraud to report. 
 
¶F. ADOPTION FRAUD 
 
Post has no Adoption fraud to report. There is no evidence of 
instances 
involving corrupt GOL officials, adoption agencies, or orphanage 
officials 
handling adoption cases.  The Ministry of Welfare (previously the 
Ministry for 
Children, Family, and Integration Affairs), which is the central 
authority for 
adoption purposes, strictly monitors local adoption agencies and 
Latvian 
orphan courts. Post has no current concerns about fraud related to 
Latvian 
government procedures for making eligible orphans available for 
adoption. 
 
Orphan courts in Latvia carry out functions similar to those of 
social workers 
in the U.S.  Orphan courts have the authority to decide if the birth 
parents' 
rights can be terminated, if an orphan should be placed in an 
orphanage, if 
custody will be transferred to someone else, and if inheritance 
rights apply 
when a child's parents die.  In the context of international 
adoptions, the 
orphan courtQs main role is to establish that adoption would be in 
the child's 
best interest. 
 
In light of extensive negative publicity on adoption in Russia and 
other CIS 
countries, there is a certain degree of opposition among officials 
in the 
Latvian government and the general public in relation to adoption. 
This has 
contributed to a general sense of reluctance to promote local and 
 
RIGA 00000486  005 OF 008 
 
 
international adoption. As of March 1, 2008, applications for 
intercountry 
adoption are approved only when the adoptive parents file to adopt: 
a)a 
sibling group of three or more children; b) a child over age 9; c) a 
child 
with severe health problems; or d) a child not adopted by Latvians, 
who is 
subsequently released for intercountry adoption. 
 
As of April 1, 2008, intercountry adoption from Latvia to the USA is 
carried 
out under guidelines established in the Hague Convention on 
Protection of 
Children and Co-operation in Respect of Intercountry Adoption. 
 
¶G. USE OF DNA TESTING 
 
Riga has requested DNA testing in very few ACS cases in the past. 
Latvian DNA 
laboratories are EU-certified, but none cooperate directly with any 
U.S. 
laboratories that are authorized to provide testing for immigration 
law 
purposes.  Currently, tests can be done with the assistance of 
Post's panel 
physician, who contacts a U.S. laboratory to conduct the test.  The 
laboratory 
in the U.S. then sends the results directly to Post and the 
applicant.  DNA 
tests have never uncovered any evidence of fraud in Riga.  Post 
monitors the 
panel physician on a regular basis to mitigate potential fraud 
concerns. 
 
¶H. ASYLUM AND OTHER DHS BENEFITS 
 
Post is aware of very few cases when Latvian passport holders 
traveled to the 
USA and claimed asylum.  Before issuing a Transportation Letter to a 
Lawful 
Resident of the U.S., post verifies applicantsQ immigrant status 
with DHS. 
Post has seen no evidence of any other DHS-benefit fraud. 
 
¶I. ALIEN SMUGGLING, TRAFFICKING IN PERSONS, ORGANIZED CRIME, 
TERRORIST TRAVEL 
 
Since Latvia joined the Schengen zone, land border checkpoints 
between 
Schengen zone countries have been eliminated.  Latvia continues to 
have border 
checkpoints on the Latvian-Russian and Latvian-Belarus borders. Due 
to the 
open borders, Latvia has become more attractive as a transit state 
for 
smugglers attempting to bring aliens into the EU and Schengen travel 
zone. 
The number of asylum seekers and third country nationals (TCNs) 
detained for 
being present in Latvia without appropriate documentation or trying 
to leave 
for other EU countries without proper travel documents has increased 
 
significantly.  Similarly, the number of people detained for alien 
smuggling 
has also increased significantly.  Specifically, 3 persons were 
detained 
between January and June of 2008, but 15 were held for this offense 
in the 
corresponding period in 2009.  The majority of asylum seekers and 
TCNs in 
Latvia without proper travel documents are from the former USSR 
countries. 
Several Syrian, Chinese, Bangladesh, Indian, and Iraqi nationals 
have also 
been detained. 
 
The number of bogus marriages between Latvian nationals and TCNs 
(e.g. 
Pakistanis, Indians, et. al.) continues to increase (see reftels C 
 
RIGA 00000486  006 OF 008 
 
 
and D). 
These fraudulent unions are generally arranged by marriage brokers 
to make 
TCNs eligible for EU immigration benefits. 
 
This year Latvia reportedly has been a source country for human 
trafficking 
(TIP) victims.  During 2009, no cases were identified in which 
Latvia was used 
as a transit or destination country for TIP victims; however, it is 
difficult 
to estimate the magnitude of TIP in Latvia since no formal surveys 
have been 
performed on the issue (see reftel D).  Victims are most often women 
deceived 
by spurious employment offers who are trafficked as prostitutes to 
Great 
Britain, Belgium, the Netherlands, Norway, Italy, Germany, and 
Cyprus. 
 
As tens of thousands of Latvian men and women leave the country in 
search of 
better employment abroad, the NGO community believes that there are 
cases 
involving unidentified Latvians being trafficked for labor 
exploitation.  Law 
enforcement continued investigating a case involving more than 50 
victims 
purportedly trafficked to the U.K. as forced labor.  With the 
Latvian economy 
in crisis and the local unemployment rate among the highest in the 
EU, there 
is a reason to believe that more Latvians may now be at risk of 
becoming TIP 
victims.  Since Latvia has entered the Schengen travel zone, 
identification of 
potential TIP instances has become more challenging (see reftel D). 
 
 
The nature of organized crime (OC) in Latvia has evolved and become 
more 
sophisticated over the last two decades. OC groups benefit from 
improved 
information technology and from holes in legislation that minimize 
scrutiny, 
as long as criminals avoid violent acts. OC groups are most commonly 
involved 
in drug trafficking, car thefts, and economic crimes.  With reduced 
or 
eliminated border control within the EU, OC groups perform more 
cross-border 
activities. 
 
According to Latvian police statistics, the number of murders has 
decreased by 
75 percent over the last 15 years.  Crimes involving the use of guns 
and 
explosives have decreased similarly.  The number of drug-related 
crimes, 
however, has increased tenfold, and combating narcotics has become a 
major 
priority for Latvian law-enforcement institutions in Latvia.  Latvia 
is both a 
transit as well as a destination country for drug trafficking. 
Police report 
many instances of drug-related cases of theft, prostitution, human 
trafficking, and money laundering. 
 
So far, post has not encountered any individuals with known 
terrorist ties. 
 
Upon receiving or obtaining credible data about individuals 
sentenced or 
arrested for serious crimes involving moral turpitude, organized 
crime, 
Trafficking in Persons, or alien smuggling, post enters quasi-hits 
or L 
lookouts in the Independent Name-Check System, if there is reason to 
believe 
that the individuals might apply for visas or visa free travel in 
the future. 
 
RIGA 00000486  007 OF 008 
 
 
 
¶J. DS CRIMINAL FRAUD INVESTIGATIONS 
 
Riga's Consular Section enjoys excellent cooperation with the 
Regional 
Security Office.  Post has established a memo format for referring 
cases to 
the RSO for investigation.  The Consular Section and the RSO in Riga 
regularly 
cooperate in conducting security checks on visa applicants who may 
be 
ineligible under certain sections of the Immigration and Nationality 
Act. 
With the RSO's assistance, the Consular Section can promptly obtain 
background 
from RSO contacts within various law-enforcement agencies. 
 
¶K. HOST COUNTRY PASSPORT, IDENTITY DOCUMENTS AND CIVIL REGISTRY 
 
Latvia has two different types of passports - citizen and 
non-citizen 
passports.  In November, 2007, Latvia began issuing biometric 
passports that 
meet ICAO standards to both citizens and non-citizens.  Passports 
issued after 
September, 2008, also incorporate fingerprints.  Citizen passports 
of the 
older type, i.e. those issued before July 2002, have been invalid 
for 
international travel since July 1, 2008. 
 
Passports are issued by the Office of Citizenship and Migration 
Affairs of 
Latvia (OCMA).  In early January 2008, a large-scale scheme was 
discovered 
wherein more than 150 Latvian passports were issued illegally to 
non-citizens 
and third country nationals between 1998 and 2005.  A number of 
government 
officials, mostly OCMA employees, accepted bribes and misused their 
powers to 
facilitate illegal issuance of Latvian passports.  OCMA employees 
issued 
genuine passports by first creating a false identity in the national 
 
citizenship registry, then issuing a genuine passport for that 
fraudulent 
identity. It is believed that wealthy Russian nationals purchased 
these 
passports to secure free movement within the EU.  Post has created 
over one 
hundred CAT1 files to reflect the fraudulent passport holders' fake 
 
identities. 
 
There are two types of Latvian driver's licenses: a new, 
EU-promulgated photo- 
digitized driving license and an older-type driving license with the 
photo 
affixed under laminate.  Driver's licenses are generally accepted as 
proof of 
identity by public and private institutions in Latvia.  The Road 
Traffic 
Safety Authority has implemented an anti-corruption program and 
cases 
involving bribery and the illegal purchase of driving licenses have 
 
significantly decreased.  Forgeries are usually based upon 
older-type driverQs 
licenses.  The Road Traffic Safety Authority reports that these 
licenses 
mostly are used for travel abroad rather than within Latvia. 
 
There is no evidence of fraud in relation to the issuance of Latvian 
civil 
records, such as birth, marriage, or death certificates.  Latvia 
does not yet 
issue national identity cards. 
 
¶L. COOPERATION WITH LATVIAN GOVERNMENT AUTHORITIES 
 
 
RIGA 00000486  008 OF 008 
 
 
Post receives good cooperation from and has excellent contacts 
within Latvian 
government institutions, including the Security Police, Criminal 
Police, 
Maritime Administration, and State Border guards.  It is not 
difficult to 
carry out the verification of civil documents through the Civil 
Registry.  The 
Security Police and the State Police have proven to be useful 
contacts when 
post wishes to check an applicant's criminal record.  The Maritime 
Administration is forthcoming about verifying sailors' credentials 
and in 
addressing concerns about the licensing of crewing agencies. 
 
¶M. AREAS OF CONCERN 
 
According to the GOL State Employment Agency and OCMA, working-age 
adults in 
Latvia are increasingly likely to look for employment abroad, given 
the 
current economic climate.  Post receives an increasing number of 
phone 
inquiries from Latvians who are eager to learn about living and 
working in the 
U.S. 
 
It is clear that B1 business visas are sometimes being confused with 
visas for 
temporary workers, investors, and intra-company transferees, perhaps 
due to a 
misinterpretation of the word QbusinessQ.  In response, Post will 
perform 
additional public outreach to better explain the purpose of B1 
business visas. 
 
¶N. STAFFING AND TRAINING 
 
Consul Timothy P. Buckley is Post's Fraud Prevention Manager.  Zane 
Zvigule is 
the Fraud Prevention Programs Analyst, and also performs visa 
processing and 
interpretation duties. 
 
GARBER