Corruption Prevention and Combating Bureau (KNAB) has commenced criminal proceedings and has detained three persons in relation to the food procurement for the needs of Latvia’s National Armed Forces.
On Thursday, the 16th of March, KNAB performed investigative procedures in multiple locations in Riga and elsewhere in Latvia, including 14 court-sanctioned searches. Activities are related to the procurement organised by the State Centre for Defence Logistics and Procurement (VALIC) for food supplies for the needs of Latvian National Armed Forces (NBS), KNAB explains.
KNAB has commenced an in-depth investigation and has evaluated both the publicly accessible information and confidential information about the procurement.
The criminal procedure was commenced in accordance with three sections of the Criminal Law – stating false information and large-scale income, abuse of power for selfish purposes and disclosure of confidential information.
«The recent geopolitical events mercilessly and directly demonstrate the ruinous effect corruption can have on the defence sector.
Suspicions or «red flags» regarding possible corruption in the defence sector have to be checked especially carefully, and KNAB is doing just that with the investigation of the centralised food procurement.
We would like to thank the administrative staff of the Ministry of Defence for their support and responsiveness during activities performed by KNAB,» said Chief of KNAB Jēkabs Straume.
KNAB continues the pre-trial investigation.
LETA previously reported that the Ministry of Defence has commenced its own internal inspection over the EUR 220 million work food procurement. The ministry has also informed KNAB and the prosecution office of this inspection. The Prosecutor General’s Office has also commenced its own investigation.
Last year Roja-based company Zītari LZ won the rights for the food supply contract worth EUR 220 million for the needs of Latvia’s armed forces for the next five years.
There is also information that suggests ex-Minister of Defence Artis Pabriks’ legal advisor Valdis Verners was involved in the decision-making process related to this procurement.
Verners previously told various media outlets that, considering the complexity of the procurement and the long time that was spent with no progress at all, he was invited to join the process on behalf of the ministry. Verners said he agreed to this «considering education, 16 years of experience in state administration and private sector, as well as experience gained as council member in Society for Openness Delna».
The procurement committee itself as led by a colleague of the current Minister of Defence Ināra Mūrniece from the National Alliance Ēriks Ezeriņš.
His father was previously known as the «grey cardinal» of the National Alliance, businessman Normunds Lakučs, who was previously the representative of the interests of For Fatherland and Freedom/LNNK in the Privatisation Agency and councils of various state companies.
Information from Firmas.lv indicates the 31 years-old company is owned by Laura Zeltiņa and lawyer Modris Supe. Zeltiņa is the beneficial owner, who is also the company’s board chairperson. KNAB database indicates that in May 2022 Supe had donated EUR 2 500 to For Latvia’s Development political party and EUR 2 000 a year prior. In 2017 and 2015 he donated a total of EUR 10 000 to the party Honour to Serve Riga.
In 2021 the company operated with turnover of EUR 562 498 and profit of EUR 141 546. A year prior the company operated with turnover of EUR 787 051 and losses of EUR 62 399. In 2019 the company operated with a turnover of EUR 3 400 068 and profits of EUR 31 800. In 2018 the company operated with turnover of EUR 2 314 098 and profits of EUR 160 985.
The company owns four cafeterias in Talsi and Riga, a bistro in Roja, as well as a pub, cafe and pizzeria in Ventspils. Information from Firmas.lv indicates the company owns nine vehicles – four cars, four trucks and one trailer.
The company’s account for 2021 mentions that the company primarily provides catering services to Rīgas satiksme, as well as various cafes and Roja Secondary School’s cafeteria. The company also provides catering services to other legal and private persons. In 2019 the company’s operations were heavily impacted by Covid-19 pandemic, as well as various epidemiological restrictions.
The contract signed with Zītari LZ covers creation of a logistical system that unites a number of food producers and other businesses in order to ensure supply of food products to all units of the country’s National Armed Forces stationed in Latvia. According to the contract, the company is also required to secure necessary food reserves for the armed forces. The contract also requires the company to ensure production and supply of food products to the army in the event of a war.
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