The European Central Bank and Governing Council member Ilmars Rimsevics accused Latvia of infringing central-bank independence by barring him from his post amid a probe into bribery accusations that he denies.

The Frankfurt-based ECB and the governor of Latvia’s central bank have both appealed at the EU’s highest court against restrictions that stop Rimsevics from exercising his office. The EU Court of Justice released details on the cases on Monday.

The Baltic country’s banking sector was rocked in February when the U.S. Treasury proposed banning the country’s third-biggest lender, ABLV, and days later Rimsevics was detained by the anti-corruption bureau for 48 hours. He was accused of being part of a group that solicited and received bribes of at least 100,000 euros ($119,340). The bank and Rimsevics deny all accusations of wrongdoing.

The ECB claims that Latvian authorities broke the law by imposing stringent bail terms on Rimsevics’ work before a ruling on the case by an independent court, the case summary shows. The ECB also says the authorities haven’t provided all the information on the case.

In a separate filing, the Latvian governor said he has been “unlawfully” prevented from carrying out his role. EU law states that central bank heads can only be removed if they can no longer perform their duties or if found guilty of “serious misconduct.”

Spokesmen for the ECB and Latvia’s anti-corruption bureau declined to comment. Rimsevics’s lawyer Saulvedis Varpins wasn’t immediately able to comment, and Latvian Prime Minister Maris Kucinskis’s spokesman Andrejs Vaivars didn’t immediately respond to a request for comment.

The ECB’s concerns “are very understandable, but I think just as understandable will be our answers,” the prime minister said in an interview with LTV on April 10. “I’m convinced that justice is on our side.”

Rimsevics, still officially a member of the ECB’s Governing Council, is barred from exiting the country and can’t even appoint a substitute. That means Latvia -- a euro-area member since 2014 -- has been unable to have a formal say on policy decisions since February. Deputy Governor Zoja Razmusa has attended as an observer at the meetings, where decisions are usually taken by consensus.

Ironically, the Governing Council will hold its next meeting in Riga, Latvia’s capital, on June 14. That could be a critical session as policy makers are expected to start debating how and when to end their 2.6 trillion-euro bond-buying program.

The ECJ has been asked by the ECB to issue an interim ruling that could soften the governor’s restrictions as early as this week.

Also on Monday, ABLV announced it had appealed at the Luxembourg-based EU court against the ECB’s decision to declare it was on the verge of failure. The bank was then closed under Latvian law after the EU bank-resolution authority said the lender was too small to warrant a rescue.

“ABLV and its Luxembourg subsidiary were neither illiquid nor was their illiquidity imminent in the foreseeable future,” the bank said in a statement announcing the filing of the case. They were “in an extraordinarily strong financial position not only as regards their capitalization and profitability but also and particularly as regards their liquidity.” </s> HELSINKI (AP) — Latvia's anti-corruption agency says it suspects the nation's central bank chief of demanding and receiving bribes of at least 100,000 euros ($125,000) and has started a criminal investigation against him.

The agency said Monday that no formal charges have so far been filed against Ilmars Rimsevics, who is also on the top policymaking council of the European Central Bank.

On Friday, the agency raided the office and a property of Rimsevics and detained him on Saturday.

Prime Minister Maris Kucinskis said after an extraordinary Cabinet meeting Monday that the central banker will face "restrictions" to be announced later.

He was quoted by the Baltic News Service as saying: "At the very minimum, he will be banned from continuing in office."

Rimsevics has served as Bank of Latvia's governor since 2001. Latvia joined the euro-zone in 2014.

Meanwhile, Latvia's financial regulator has ordered the crisis-struck ABLV Bank to cease all payments on the request of the European Central Bank amid U.S. accusations of money laundering and breaching sanctions on North Korea.

The ECB said Monday that the Financial and Capital Markets Commission of Latvia has imposed "a prohibition of all payments by ABLV Bank on its financial liabilities" until further notice.

The ECB noted that ABLV has seen a sharp deterioration of its financial position in recent days.

Latvia's central bank said separately that it would loan ABLV 97.5 million euros ($121 million) against "a reliable pledge of highly liquid securities" instead of 480 million euros ABLV had requested.

ABLV is Latvia's third largest bank by assets.

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. </s> RIGA, Feb 19 (Reuters) - The head of Latvia's central bank should resign following his detention by the anti-corruption agency, Prime Minister Maris Kucinskis said on Monday.

Latvia's Corruption Prevention and Combating Bureau detained Governor Ilmars Rimsevics on Saturday after searching his house and office.

"I can't imagine that a governor of the Bank of Latvia detained over such a serious accusation could work," Kucinskis told Latvian television .

"So in his case, of course, I think that he should himself (resign)."

Rimsevics' lawyer has said the detention of the central bank Governor is unlawful.

The government is holding an emergency meeting on Monday to discuss the case and the anti-corruption agency will hold a news conference at 1100 GMT.

Neither the anti-corruption agency nor Rimsevics' lawyer has commented on the reason for his detention.

The Latvian central bank is an independent institution and Rimsevics has been its head since 2001. He has been a member of the European Central Bank's Governing Council since January 2014, when Latvia adopted the euro. (Reporting by Gederts Gelzis; Editing by Toby Chopra) </s> Latvia's central-bank chief has been released from custody on bail hours after the Baltic country's anticorruption agency accused him of receiving at least 100,000 euros ($125,000) in bribes.

The Corruption Prevention and Combating Bureau (KNAB) said on February 19 that no formal charges had been filed against Bank of Latvia Governor Ilmars Rimsevics, who was detained by police over the weekend.

Hours after the statement, the Delfi news portal showed video of Rimsevics leaving KNAB premises in Riga with his lawyer.

"I categorically disagree with [the charges]," Rimsevics said in the video to reporters at the scene.

Despite the denial of wrongdoing, Prime Minister Maris Kucinskis has called on Rimsevics to recuse himself from his duties while a criminal investigation against him is carried out.

Rimsevics has held the post since 2001 and is also a member of the European Central Bank's (ECB) governing council.

Latvia is a European Union member and uses the euro as its currency.

KNAB did not elaborate on the charges against Rimsevics, but AP reported on February 19 that executives at Latvian bank Norvik said the central-bank chief sought to extort money from their firm for years.

According to the news agency, Norvik has filed an international complaint against Latvia in which it claims a "senior Latvian official" sought bribes from the bank and abused his power. Norvik's CEO, Oliver Bramwell, told AP, "The high-level official mentioned in our request for arbitration is Rimsevics."

Latvia's financial sector is in upheaval with the investigation and a crisis at ABLV Bank, the country's third-largest bank by assets.

Latvia's financial regulator has ordered the bank to cease all payments after its liquidity position deteriorated sharply amid U.S. accusations of money laundering and breaching sanctions aimed at thwarting North Korea's weapons program.

The Treasury Department said in a statement last week that ABLV also facilitated transactions linked to "large-scale illicit activity connected to Azerbaijan, Russia, and Ukraine."

To shore up ABLV's finances, the central bank has said that it will loan the bank 97.5 million euros ($121 million) against "a reliable pledge of highly liquid securities."

With reporting by AP, Reuters, and Bloomberg </s> RIGA, Latvia — The prime minister of Latvia says the country's top central banker has been detained following questions from the national anti-corruption agency.

Maris Kucinskis issued a statement Sunday confirming that Ilmars Rimsevics, a policymaker of the European Central Bank, was detained.

On Saturday evening, Latvian state TV showed Rimsevics arriving by car to the anti-corruption agency and leaving hours later. The state TV reported that Rimsevics' office and one of his properties had been raided.

The anti-corruption agency, the Bank of Latvia and the European Central Bank all declined to comment.

Kucinskis said "there are no signs of a threat to the Latvian financial system." In a tweet, the Latvian presidency said there would be a meeting of the National Security Council next week to discuss the banking sector. </s> LONDON — The Latest on the bribery investigation on the Latvian central bank chief (all times local):

Latvian state TV reports that the country’s central bank chief has been released from detention on bail pending an investigation into suspected bribery.

The channel showed Ilmars Rimsevics speaking to reporters Monday evening and saying that he “rejects everything” that has been alleged about him. An Associated Press investigation found that a Latvian bank is accusing Rimsevics of seeking bribes for years, abusing his power and being connected to individuals involved in money laundering from Russia.

Rimsevics was detained on Saturday evening after questioned by Latvia’s anti-corruption authorities.

The state TV quoted Rimsevics’ lawyer, Saulvedis Varpins, as saying that more information on the case will be provided Tuesday.

Executives at Latvian bank Norvik say the nation’s central bank chief, who was detained Saturday without charges, sought to extort money from their firm for years.

Latvia Central bank chief Ilmars Rimsevics faces a criminal investigation for bribery but is not charged so far.

Norvik has filed an international complaint against Latvia in which it claims a “Senior Latvian Official” sought bribes from the bank and abused his power. Norvik’s CEO, Oliver Bramwell, told The Associated Press: “The high-level official mentioned in our request for arbitration is Rimsevics.”

Norvik’s chairman, Grigory Guselnikov, also told the AP how individuals connected to Rimsevics had asked his bank to launder money from Russia.

Rimsevics is also on the highest policymaking council of the European Central Bank, which sets monetary policy for the 19 euro countries. </s> LONDON — Latvia’s top banking official, a key member of the European Central Bank, has been accused by local bank Norvik of seeking kickbacks, trying to launder Russian money and retaliating against the bank when it refused to play by the “rules of the game.”

In a high-stakes drama for the tiny Baltic country, Ilmars Rimsevics was detained Saturday by Latvian anti-corruption authorities and questioned for hours into the night. State TV showed him walking free on Monday, without charges, though he is still being investigated for suspected bribery.

Norvik bank has filed an international legal complaint against Latvia in which it alleges that a “Senior Latvian Official” repeatedly sought “to extort monetary bribes,” and threatened the bank when its owner and chairman, Grigory Guselnikov, refused to pay up.

“The high-level official mentioned in our request for arbitration is Rimsevics,” Norvik’s CEO, Oliver Bramwell, told The Associated Press. Guselnikov confirmed that it was Rimsevics.

Rimsevics’ lawyer told Latvian TV that he promises to provide more information about the case on Tuesday. The ECB declined to comment on Rimsevics’ status.

The threat of criminal charges against the man who has been at the top of the country’s banking sector since 1992, in the wake of the Soviet collapse, has plunged the small Baltic nation into turmoil.

Rimsevics’ detention is particularly sensitive as he sits on the top policy-making council of the ECB, Europe’s most powerful financial institution, and is privy to the state secrets of Latvia, NATO and the European Union.

Any connections to money laundering would raise concerns of the risk of blackmail from Russia’s secret services or organized crime, and come at a time when Latvian security services warn that Russia is actively trying to obtain state secrets from Latvian officials to weaken the European Union and United States.

Guselnikov said he first met Rimsevics in 2015 after he was introduced to a man called Renars Kokins, who was said to know the country’s legal and political landscape well. Kokins invited Guselnikov to a meeting in a large villa in the suburbs of the capital. Soon after Guselnikov got there, another man arrived, on foot, and entered without knocking: it was Rimsevics.

He was brief and to the point. He told Guselnikov he could help him because the nation’s financial regulator was loyal to him personally. All he had to do was “co-operate” with Kokins, Guselnikov recalled.

Rimsevics left 10 minutes later and Kokins sat Guselnikov down at a table. He pulled a pen out and wrote on a piece of paper: “100,000 per month.”

Kokins did not use the word “payment.” He explained to the banker that all Latvian banks “co-operate” in this manner, Guselnikov says.

In the following weeks, Guselnikov tried to stall but found that every time he refused to pay, his bank would get hit with new regulatory measures.

Kokins did not relent, finding Guselnikov repeatedly after that.

Guselnikov says he met with Kokins and Rimsevics a few more times to try to clarify his position. Rimsevics took great care to not be seen at these meetings, Guselnikov says.

On one occasion, Kokins drove Guselnikov around the capital, Riga, for almost two hours before parking in front of a Chinese restaurant in the city outskirts. Kokins left the car and minutes later, Rimsevics entered it and sat behind Guselnikov, in the back seat, to speak, Guselnikov said. Another time they met in the restaurant itself, when it was completely empty.

“It was a nightmare for me for years,” said Guselnikov, who is 41. “You can’t understand how to get out of this dirty environment without reputation damage. That is why I decided to go out publicly and legally with my case. I can lose the bank, my money, but I will never become part of it.”

Latvia has become infamous for money laundering since the high-profile Magnitsky scandal, in which $230 million in Russian taxpayers’ money was siphoned off, largely through Latvian banks, according to U.S. and European authorities. Whistleblower Sergei Magnitsky was imprisoned in Russia in 2008 and allegedly beaten and denied medical care, leading to his death. The U.S. and EU sanctioned Russian individuals over the case.

In 2014, a trove of leaked documents, the so-called Laundromat reports by the Organized Crime and Corruption Reporting Project, detailed how $20 billion was sent from Russia, largely through Latvia, in 2010-2014.

Latvian banks then went through an independent audit last year, after which Latvian regulators levied fines against three banks for a total of 640,000 euros.

One week later, France fined Latvian bank Rietumu 80 million euros for money laundering. Major global banks, meanwhile, have stopped making dollar transactions with Latvian banks after the Laundromat’s leaked documents illustrated how dirty money had reached firms like Deutsche Bank by way of Latvian banks.

Last week, the U.S. Treasury singled out one of Latvia’s biggest banks, ABLV, for having “institutionalized money laundering,” and the ECB on Monday blocked ABLV from making payments amid concerns about its finances. That forced ABLV to need a 97.5 million-euro ($121 million) loan from the Latvian central bank to stay afloat and keep the country’s financial system secure.

All of this happened on the watch of Rimsevics, who became chairman of the Bank of Latvia in 1992 after attending college in New York state, and then governor, the top policymaking role, in 2001. </s> RIGA, Feb 18 (Reuters) - Latvia’s central bank Governor Ilmars Rimsevics should step down while he is under investigation by the country’s anti-corruption agency, its finance minister said on Sunday.

Prime Minister Maris Kucinskis said earlier on Sunday that Rimsevics, who is a member of the European Central Bank’s Governing Council, had been detained by the anti-corruption agency.

“Given that the governor of the central bank is a symbol for every country, I think that it would be sensible at this moment that Mr. Rimsevics, at least during the investigation, steps down,” Reizniece-Ozola told a press conference, without offering any details as to why the governor was detained or what he was being investigated for.

The governor’s home and office were searched on Friday, Latvian media reported. (Reporting by Gederts Gelzis, writing by Johan Ahlander; Editing by Susan Fenton) </s> Image copyright Reuters Image caption No official reason has yet been given for Mr Rimsevics' detention

The head of Latvia's central bank, Ilmars Rimsevics, has been detained by the country's anti-corruption agency.

His home and offices at the Bank of Latvia were both raided by officers.

The country's Corruption Prevention Bureau gave no details about its investigation, or the nature of the raids.

Latvia's Prime Minister, Maris Kucinskis, has called an emergency cabinet meeting on Monday - but added there was no apparent national threat.

"There are no signs that there is any threat to the Latvian financial system," he said in a statement.

He said neither he, as prime minister, nor any other officials had any reason to interfere with the anti-corruption agency's work.

"The institution works professionally and accurately," he said, pledging the government's full support and saying there would be no outside influence.

The Bank of Latvia said it could not comment on the investigation, but said it had a "zero tolerance policy in respect of corruption and other illicit activities".

It said the bank's operations were unaffected by the investigation, and that it would open on Monday as usual.

A number of banks in Latvia have been subject to investigations in recent months.

In July 2017, two banks were fined for allowing their clients to circumvent international sanctions preventing payments to North Korea.

Another, Norvik Bank, is embroiled in a dispute with the state over what it calls "unfair, arbitrary, improperly motivated and unreasonable regulatory treatment".

Precisely what that entails has not been disclosed.

It is unclear if either of the investigations are in any way linked to the detention of Mr Rimsevics.

In his capacity as the governor of Latvia's central bank, Mr Rimsevic is also a member of the European Central Bank's governing council.

Latvia became the 18th member of the Eurozone on 1 January 2014.
Latvia will ask the European Central Bank not to renew the mandate of ECB Governing Council member Ilmārs Rimšēvičs, the head of the central Bank of Latvia since 2001, amid an ECB payment moratorium and an U.S. graft investigation into Latvia's third-largest lender, ABLV. On 19 January, Rimšēvičs was released on bail.