Searches in Alūksne EU-funded project case: Finance Minister Kučinskis points to earlier checks

Latvia's Corruption Prevention and Combating Bureau (KNAB) conducted searches on Wednesday in a case opened by the European Public Prosecutor's Office (EPPO), the EU body that investigates crimes against the financial interests of the European Union. The case concerns suspected procurement fraud and abuse of office in an Alūksne municipality project funded by EU money.

What is being investigated

The project, "Development of infrastructure important for business in Alūksne municipality", aimed to build three production buildings and lease them to companies. According to EPPO, the tenants were to be chosen through a rental auction conducted in an open, transparent and non-discriminatory way. Investigators say municipal officials, together with representatives of local companies, may have taken part in unlawful acts to obtain more than €1.4 million from the European Regional Development Fund (ERDF). EPPO's evidence reportedly indicates the suspects misled the responsible authorities and built the facilities for previously selected entrepreneurs.

During the searches, documents, cash and ammunition were seized. Procedural actions were also carried out at the home or affairs of Mārtiņš Brencis, a former adviser to Prime Minister Andris Kulbergs who for many years served as deputy director of the Central Finance and Contracting Agency (CFLA). EPPO gave no further details, so the number of people involved is unknown.

Reactions

Finance Minister Māris Kučinskis said it is hard to tell which site is concerned because of a lack of information. He said that in 2022, after receiving a report, CFLA checked the project and informed KNAB and EPPO, both of which saw no violations. CFLA said it has no official information on the scope of the investigation.

Alūksne municipal council chairman Dzintars Adlers confirmed that KNAB carried out procedural actions at the municipality and that no employee was detained. He maintained that all the buildings were leased through auctions and that the municipality broke no rules.

The three buildings were completed in 2022 in Alūksne and Jaunlaicene parish, at a total construction cost of €1,448,091.51.