The collapse of Latvian and Estonian payday lender MiniCredit shows that banking oligarchs Valery Kargin and Dmitri Koval are still at it, not slowing down their activity even after Kargin’s Parex Bank was revealed as a pyramid fraud and then fraudulently bailed out by the corrupt Latvian government.
Apparently Kargin and Koval worked with Rolands Petersons of PrivatBank, which was also a pyramid fraud, to license MiniCredit in Latvia and Estonia and amazingly given their histories were granted licenses.
They then opened a bank account at Citadele Bank, which is a successor to Parex and still apparently controlled by Kargin since his top offshore banker Valery Hudorozhkovs is still there.
A large amount of money was somehow run through MiniCredit’s account and then disappeared. Some of this was presumably from low-income clients with payday loan accounts. And perhaps some of it was from Russians running money through the accounts for laundering purposes, given the size of the withdrawals relative to the size to the company’s legitimate activities.
An interesting detail of this case is about Koval, whose Saules Bank of Latvia was caught laundering money although authorities never bothered to prosecute anyone. Saules Bank is today merged into Rietumu Bank which is also a money launderer.
Just after Parex whistleblower John Christmas gave details of massive frauds at Parex to Latvian authorities in 2005, who ignored the information, Koval invited Christmas to meetings to discuss establishing a new bank in Latvia to serve Koval’s clients, who he described as Jewish billionaires in Moscow. Koval wanted Christmas to be a front for the bank, making it seem like an American bank even though the clientele would be Russian.
Kargin and Koval don’t need Christmas to be their American front anymore since they found someone better. Supposedly former Fed chief Paul Volcker is the owner of Citadele today, although we doubt Volcker has any clue what is happening there.
We continue to hope the EU and US authorities will wake up and realize that the Latvian government is running a racket to help Russians steal money from Europeans, Americans, and especially Latvians.