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Abu Dhabi, UAEFriday 14 December 2018

Scandal-hit Latvian central bank governor won't quit over bribery allegations

Latvia, a country of 2 million people is a popular destination for cash from the former Soviet Union

Ilmars Rimsevics, governor of the Bank of Latvia, pauses during a Bloomberg Television interview in Riga, Latvia, on Thursday, Feb. 22, 2018. Rimsevics said he's never been offered a bribe but there's been a "hint" of one and that he regrets not reporting it. Photographer: Roni Rekomaa/Bloomberg
Ilmars Rimsevics, governor of the Bank of Latvia, pauses during a Bloomberg Television interview in Riga, Latvia, on Thursday, Feb. 22, 2018. Rimsevics said he's never been offered a bribe but there's been a "hint" of one and that he regrets not reporting it. Photographer: Roni Rekomaa/Bloomberg

Latvia’s central bank governor dug in over a crisis that’s rocked the tiny Baltic nation, reiterating that he won’t resign in the face of allegations he sought bribes and is instead searching for ways to maintain his role in shaping euro-area monetary policy.

Ilmars Rimsevics, a member of the European Central Bank’s Governing Council, said Thursday in an interview with Bloomberg TV that he won’t step aside, even on a temporary basis. He said he’s spoken to ECB officials, though not President Mario Draghi, about continuing his work there.

“Once you step down, you step down -- and that’s it,” Mr Rimsevics said in the capital, Riga. “I had a conversation with members of the board of ECB, not Mario Draghi personally,” he said. “At the moment there are possibilities, they’re looking into the text so that I could go to Frankfurt and continue work as a Governing Council member.”

The storm around Mr Rimsevics, who was released on bail after being detained last weekend, has rattled the country of 2 million people, a popular destination for cash from the former Soviet Union. It’s not the only scandal: the US Treasury Department has proposed banning ABLV Bank AS, Latvia’s third-biggest lender, from the American financial system, accusing it of institutionalised money laundering and aiding entities linked to North Korea’s missile program.

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Latvian officials have urged Mr Rimsevics, who hasn’t been formally charged, to step aside to protect the nation’s reputation. The 52-year-old has led the central bank since 2001, making him the longest-serving head of a national bank on the ECB’s Governing Council, which he joined in 2014 when Latvia adopted the euro. He said Thursday that he’s never been offered a bribe, though there’s been the “hint” of one in the past.

“I’ve been hinted but these are very thin-ice things and you never never know how these things are,” he said.

Riga-based Norvik Banka, controlled by Russian-born Grigory Guselnikov, has leveled separate bribery allegations against Mr Rimsevics. The Corruption Prevention and Combating Bureau, which detained him, said its inquiry doesn’t relate to Norvik or any bank currently operating in Latvia. The Defense Ministry has suggested Russia may be behind a disinformation campaign aimed at eroding public trust before elections in October.

Mr Rimsevics said he’s no “friend” of Latvian banks and that some lenders in the European Union, euro-area, and NATO member are conspiring against him and making false accusations.