POINTING FINGERS: Karlis Mikelsons claims he’s the victim of an election-year power struggle.
RIGA - Egons Rusanovs, the attorney for former electric utility Latvenergo chief Karlis Mikelsons, believes that the Corruption Prevention Bureau (CPB) exceeded its authority in the so-called Latvenergo money-laundering affair, and that Mikelsons will therefore turn to the European Court of Human Rights with a complaint, reports news agency LETA. Rusanovs, speaking on the LNT show ‘900 Seconds,’ said “the powers and opportunities vested in the CPB are too great. It frequently acts outside the limits of special agencies.”
In his opinion, it would be enough to ensure that the law was observed during the criminal process. “The only rules of the game that I recognize are the Criminal Procedure Law and the Criminal Law,” stressed Rusanovs, indicating that the main violations were connected with the searches performed at Mikelsons’ home and workplace without the necessary warrants.
Rusanovs noted that at present the possibilities of turning to international legal institutions were limited while all judgments were yet to come into force; however, a petition would certainly be submitted to the European Court of Human Rights.
Stoking the conspiracy theory camp, Mikelsons says he believes that his detention was part of the power struggle ahead of the 10th Saeima elections due this fall. “I believe that my detention is part of the pre-election power struggle, and it basically deals with the future of Latvenergo which, in my opinion, is of utmost importance to the Latvian economy,” said Mikelsons, pointing to the rumored agreements between the government and the International Monetary Fund on privatization of the company.
The former head of Latvenergo denies that it was possible for him or his colleagues at the company to ensure that decisions be made in the interest of the companies Alstom Network Switzerland and GAMA GUC Sistemleri Muhendislik ve Taahhut. He also claims that he has derived no personal benefit from any of the decisions that dealt with reconstruction of the Riga cogeneration plant.
Mikelsons added that the matter had been reviewed by the company’s board, the government and the National Security Council on several occasions. “A decision was made that the cogeneration plant had to be renovated. The National Security Council was several times informed that GAMA was the favorite in this competition,” Mikelsons said.
Commenting on the money laundering allegations, he points out that “The only thing I know is that I sold a land plot for 571,000 euros.” Mikelsons goes on to say that “I did not have any other deals outside my job in which I could have gained big money, only this one. I have not sold anything else but that land plot.”
Mikelsons says the allegations that he had ensured decisions in favor of Alstom Network Switzerland and GAMA GUC Sistemleri Muhendislik ve Taahhut are unfounded. He explains that all the procedures at the company ensure that “It is impossible for me, or together with the other colleagues, to influence what decisions are made. A number of experts are involved in the process, and the decisions are made at several levels.”
The Latvenergo board decides, on the basis of the minutes of the project commission and the competition commission, whether to conclude a contract with a company or supplier. Later on the process is supervised by the procurement monitoring commission, and then decided by the company’s supervisory council. All contracts worth more than 550,000 lats (785,700 euros) have to be coordinated with the supervisory council, says the former chief.
Alstom was involved in the reconstruction of the Plavinas hydropower plant. “This is an old story that goes back to 1996, when it was decided that the hydraulic units of the power plant had to be reconstructed. The European Bank for Reconstruction and Development financed this project. The bank also selected Alstom to do the job.” The then-finance minister insisted that GAMA should be hired for the project. “The decision took a very long time; it was repeatedly reviewed by the company’s board and the Cabinet of Ministers.
It was further considered by the National Security Council, and when the signing of a contract with this company was approved, the sponsors - the European Union and the European Bank for Reconstruction and Development - were involved in vetting the project; if I am not mistaken, 80 specialists and various experts examined the matter. When it was endorsed, Latvenergo shareholders also voted on the project, as prescribed by the law.
The contract also needed to receive permission from the Ministry of Finance. For more than a year already, the procedure is that all contracts worth more than 100,000 lats have to be authorized by the minister of finance. “I do not see how I could have influenced these decisions. The company’s board, though, has the right to halt or at least suspend an investment project. From 2000, since I have been working at the company, until June 14, 2010, when I was still in office, practically all the decisions of the board were made unanimously. In all cases when we had any doubt, the matter was removed from the agenda; there have never been any split votes,” said Mikelsons.