Minister quits amid embezzlement probe

Estonian Culture Minister Signe Kivi offered to resign over embezzlement allegations at a state cultural foundation she supervises.

Her announcement came Aug. 15 after police arrested Avo Viiol, director of the Estonian Cultural Foundation, on suspicion of embezzling 6.5 million kroons (420,000 euros) from foundation accounts.

The police acted after Kivi informed them of the missing funds, saying she could not account for their whereabouts.

"Recognizing political responsibility for what has happened, I informed the prime minister of my wish to resign," Kivi said in a statement.

"It is hard to express my sorrow over the stain on the image of such an important cultural institution," she said.

Prime Minister Siim Kallas said the government would wait for the results of a police investigation before deciding whether to accept Kivi's resignation. Kivi, a member of the ruling center-right Reform Party, has served as culture minister since 1999.

Police said Viiol, 44, had confessed to taking money from the foundation's 5.3 million euro budget between 1999 and 2002 to pay off gambling debts.

He will likely be charged for mass misappropriation of funds, police said, a crime that carries a sentence of up to seven years in jail.

A Tallinn city court extended the time period during which police can hold him until Aug. 25.

The missing money became evident when the ministry realized it could not complete the foundation's annual financial report because Viiol had not provided documentation on expenses.

The cultural foundation was established to channel state money to cultural figures and institutions, including theaters and the state opera.

In a written confession distributed to media by the police, Viiol, a former analyst at the Bank of Estonia, said a fascination with gambling that began in 1999 led him to start skimming money from the foundation's accounts.

"At that time, I thought I could win in a casino," he wrote. "That was a false belief."

Viiol said he transferred millions of kroons in 2000 and 2001 from foundation accounts to his own private bank accounts. As he fell deeper into debt, he said he had decided to turn himself in.

"I am guilty of two things: I took money that did not belong to me and I ruined the concept of the foundation, a concept people believed in," he wrote.