Financial Services, Latvia, Legislation, Transport

The TV3 show "Neka personiga" reported last night that Rigas satiksme may be possibly involved in a fraud scheme related to the company's procurement of detergents and other cleaning aids. Neither the Corruption Prevention Bureau, nor the State Police are investigating the matter.

Rigas satiksme operates 923 trams, trolley-buses, and buses. In 2014, they carried more than 150 million passengers. At the end of each day, Rigas satiksme vehicles are parked in maintenance depots where they are cleaned and undergo maintenance by the Technical Control Department of Rigas satiksme. To do this, the department uses brushes, buckets, and special detergents.

In 2013, Rigas satiksme signed an agreement with construction company MJ partneri. The company says that the offer came very unexpectedly – through a former employee who offered MJ partneri to participate in a Rigas satiksme price survey. The amount of the procurement contract – LVL 280,000 (more than EUR 390,000), including value added tax (VAT), was the maximum amount for which price surveys could be done without announcing a public tender.

MJ partneri had no experience in such matters, yet the former employee promised that the company would act only as a go-between, while his relative Vita Baurovska would do everything else, as she works for a company which can supply the necessary detergents. MJ partneri agreed and settled for 3 percent of the contract amount for providing mediation services.

Baurovska worked at a company that had tax problems and therefore could not participate in the procurement. After signing contract with Rigas satiksme, MJ partneri concluded agreement with Baurovska's company, which supplied MJ partneri with all the necessary detergents that were then shipped to Rigas satiksme, without ever reaching MJ partneri. Rigas satiksme paid a total of LVL 339,917 for the detergents.

MJ partneri was eventually visited by the State Revenue Service's officers who launched a probe into the deal, as there were no invoices over the products supplied to Rigas satiksme.

It turned out that Rigas satiksme was actually not supplied detergents – the containers shipped to Rigas satiksme contained water. Vjaceslavs Stunzans, deputy head of Rigas satiksme Technical Control Department, was involved in the scheme.