The majority shareholder, Andres Bergmann, former board chairman Jaak Kiiker and finance director Peep Akkel were arrested under a code dealing with embezzlement on a large scale through misappropriation or squandering. According to this law, the suspects can be sentenced from three to eight years in prison.
"The suspects are released now. The police is doing its job," said Urmas Tross, bankruptcy trustee of ERA Bank.
The police wanted to hold the bankers for a six month investigation, but the court turned down the application, ruling that the suspects would do no harm to the investigation. The suspects also promised not to leave their residences.
The troubles of the bankrupt ERA Bank started with its establishment in 1991, when the value of initial contributions was overestimated.
"The biggest problem in the bank was the artificially increased asset side in the balance sheet, which did not bring the inflow of liquid assets. Accounting can no more be objective in this case," said Tross. "The loans were not paid back. One of the managers (Peep Akkel) dealing with the bank's finances used the bank's money without the knowledge of others," said Tross.
The managers of ERA Bank also used the money to buying personal things like alcohol, pet food, clothes and watches. "As I mentioned at the meeting of creditors, the use of the bank's assets has not caused any difficulties to the bank," said Tross.
ERA Bank has credit claims worth of 361 million kroons and assets for 120 million kroons. The bank has 1,079 creditors and Tross believes about one third of the credits will be paid back.
"It depends much on how the companies related to Andres Bergmann will pay back their debts," said Tross.
According to Tross, all three suspects claimed innocence.