Dear LawlessLatvia fans,
Something amazing happened. For the first time since the EBRD-Eurostat-Dombrovskis cover-up campaign began eleven years ago, Eurostat has in a way communicated with me. They won’t talk directly and won’t acknowledge that they know I exist. However I was messaging with a journalist and he was asking them questions and they were uncharacteristically responding to him.
As we know, the assets of Parex were fake for many years because of their policy of making related-party loans and booking them fraudulently. This sort of ‘lending’ (actually, embezzlement) can continue as long as a bank is growing however is exposed if a bank has to deleverage.
In 2009, Valdis Dombrovskis was Prime Minister and he signed a deal which gave the appearance that Latvia sold a stake in Parex to the EBRD. If this was true, then it meant that the EBRD thought Parex was solvent.
Then, Dombrovskis won re-election because, according to himself, he rescued Latvia from ‘Sweden.’ The oligarchs are still probably laughing in their palaces about how anyone believed that stupid make-believe story.
After Dombrovskis was re-elected, I managed to get confirmation from the Dutch Parliament that he didn’t really sell a stake to the EBRD in 2009 because of a secret side-deal with the EBRD which they called a ‘put option.’
In 2014, the EBRD exercized the put option and Latvia reversed the 2009 privatization, paying a premium to the EBRD.
Explained more directly, Parex was worthless in 2009. It had been looted. Dombrovskis knew this and the EBRD also knew this. In order to protect the criminals who looted the bank and as an alternative to trying to recover the stolen money, Dombrovskis convinced the EBRD to buy the stake by secretly promising to reverse the transaction in 2014 after the election.
A surprise was that Eurostat was aware that he had done this and approved. Eurostat is responsible for integrity in EU statistics thus they were doing exactly the opposite of what they are supposed to be doing.
The first comment from Eurostat was that the amount of public money Dombrovskis secretly used to pay the EBRD was 100 million euros which is only 0.4% of GDP and therefore unimportant.
I countered that I believe 2 billion euros or more was embezzled from the bank, which means that the true cost to taxpayers was 2 billion plus 100 million euros. This was a significant part of GDP.
Eurostat countered that the amount of money that disappeared from the bank was only 800 million euros and therefore this transaction only caused Latvians to lose a total of 900 million euros which is ok.
Eurostat said that their rules allow member states to use put options and to keep the put options secret from voters and creditors. With Dombrovskis, the put option wasn’t even disclosed to rival political parties. It was designated as a state secret meaning that anyone who spoke of it would face criminal prosecution.
Calling a secretly negotiated reversion a put option doesn’t make sense. Eurostat indicated that if a put option is exercised, then the government must tell people about it, but not earlier. Eurostat rationalized that there was a possibility that the EBRD would not use the put option. But the only reason the EBRD ‘bought’ the stock in 2009 was because of the put option and they would have lost 100% of their investment if they didn’t use it!
We still aren’t sure when this will end since the Parex privatization fraud has been rolled over into the Citadele privatization fraud. According to Eurostat’s report on Latvia published in 2018 but read by almost nobody and not appearing in the Latvian media or Citadele annual reports, the sale of Citadele stock to the EBRD will also be reversed because of another secret put option.
Just wanted to keep everyone updated, especially since Dombrovskis is now European Commission Executive Vice President. Eurostat is aware of the ongoing cover-up and they could shut down the Latvian oligarchy and the largest money laundering racket in European history by reversing their decision to approve the so-called ‘put option’ however so far they are refusing to do their jobs.
Thank you,
John Christmas
