Archive for February, 2013

Another company with strong political links involved in Autorollo affair

Äripäev writes that Autorollo Ltd, a trucking firm that belonged to the father of current Minister of Environmental Affairs Keit Pentus-Rosimannus before it went bankrupt under mysterious circumstances had done shady business with Autovaal Ltd.

Autovaal belongs to Tehnovaal Ltd which was founded by and belongs to Toomas Tauts, prominent member of IRL.

Tauts is an influential member of IRL, the party of the Minister of Economic Affairs Juhan Parts, and on the proposal of Parts, sits on the supervisory board of Eesti Energia.

One connection that Autovaal has with Autorollo is that it lent money to Autorollo that was having financial problems and later transferred its claim against Autorollo to Renalto Invest Ltd which belonged to lawyer Siim Roode and helped to empty Autorollo of assets.

Between November 20 and 25, 2009 Autovaal made two money transfers to Autorollo in the total amount of 500,000 kroons (about 30,000 euros).

When Äripäev asked Toomas Tauts about the transaction he offered no comment.

Rain Rosimannus who is suspected to have been the mastermind behind the scheme to empty Autorollo of assets said he had nothing to do with Autorollo.

Loan contract of Autorollo probably forged

The scandal implicating the influential Rosimannus family has got a new twist as a loan contract with which trucking firm Autorollo lent 2 million kroons to a Russian businessman based in Pskov seems to have been forged.

Äripäev tracked down Roman Moiseev, the Russian businessman in Pskov who allegedly borrowed the money from Autorollo. He denies any knowledge of the debt and said he has never met the company’s executives.

In 2010 the trucking company that belonged to Väino Pentus, father of Keit Pentus-Rosimannus, Minister of Environmental Affairs and one of the most influential members of the Reform Party, had lent 2m kroons in cash to a Russian citizen Roman Moiseev.

In addition, the company lent 1 million kroons to Est-Trade Group, a company of Hillar Talts that is being liquidated.
By the time when the loan contracts emerged, the company had gone under the control of Siim Roode who is closely linked to Keit-Pentus Rosimannus and Rain Rosimannus.

Creditors of Autorollo say that the fact that no-one in the company have actively claimed back the loans, seems to indicate it was disguising outflow of cash from the company.

The loan contract signed with Roman Moiseev, a Russian businessman, has his date of birth on the contract, but his signature is different from that on the loan contract.

“My date of birth, names and home address shown on the contract are accurate,” he confirmed.

Moiseev said that Estonian media had this week sent him the loan contract that he had allegedly signed. He says that while his personal data on the contract are accurate, the signature is forged.

Moiseev says that although he often visits Estonia, at the time when the contract was signed he was not in Estonia.

Another sign that everything is not above board with this contract is that although the cash to Moiseev was paid out by Väino Pentus, the only signature on the contract is that of Moiseev which now seems to have been forged.

“I don’t even know a company called Autorollo,” said Moiseev yesterday.

Tiit Pohl who in 2008 sold Autorollo to Väino Pentus and was the company’s board member until 2010 said that Rain Rosimannus had helped Autorollo borrow 8 million kroons from Swedbank back in 2008.

The loan was secured by Kredex.

Pohl said that Rain Rosimannus also advised Väino Rosimannus in the company’s acquisition.

According to Pohl, Rosimannus wanted to get the loan from Nordea because they had leased their trucks from Nordea, but Nordea refused.

Pohl says that Rosimannuses were actively involved when the company was already going under and gave orders how to siphon assets out of the company and hide its debts.

“They even told the board member of Autorollo to tell the company’s customers to pay to a bank account in SEB and not to the one in Swedbank because Swedbank could have seized the money. They also hired lawyers to ensure that they were able to line their pockets as much as possible,” said Pohl.

Rain Rosimannus admitted yesterday that he had met with Swedbank representatives over the loan to Autorollo, but he says that he remembers nothing about obtaining a security from Kredex.

Rosimannus still claim that he had nothing to do with managing Autorollo and was simply helping his wife and his wife’s father.

Son of Siim Kallas involved in Autorollo affair

Ülo Kallas, son of European transport commissioner Siim Kallas, helped Rain Rosimannus, one of Reform Party’s most influential members, to secure a loan for Väino Pentus, father of current Minister of Environmental Affairs Keit Pentus-Rosimannus, writes Äripäev.

Pentus who owned trucking company Naitsirk needed money to buy Autorollo, a trucking company that belonged to Tiit Pohl. He bought the company and merged them into Autorollo which soon afterwards went bankrupt under suspicious circumstances.

The loan of almost 600,000 euros was granted by Swedbank to Naitsirk Ltd in 2008 when Ülo Kallas worked as head of project financing department in Swedbank in Estonia. This loan was never repaid.

Although Kallas who now works as head of capital markets of Finance Estonia at first denies having mediated the loan or contacts, he then admits that he helped to make sure that Rosimannus met with the “right people” at the bank.

“I did it because I knew Rosimannus,” said Ülo Kallas to Äripäev, adding that the loan in question was too small for his department.

The seller, Tiit Pohl, has claimed that the loan which was granted in 2008 was managed by Väino Pentus and Rain Rosimannus. According to Pohl, at first they asked a loan from Nordea, but it refused.

When Äripäev asked Rain Rosimannus for confirmation, he said that he cannot comment it because of the ongoing court dispute.

Although Rosimannus claims that he was simply advising the company’s restructuring, was doing a favour to the father-in-law and played no active role in the company, he admitted that he helped to apply the loan.

The loan in question was guaranteed by Kredex, a state export credit agency. The Finance Ministry has now said that in its opinion Kredex did nothing wrong in backing the loan that was used to procure transport vehicles and equipment and that Kredex had not violated EU state aid rules.

This is questionable because while EU rules prohibits to use state aid for acquisition of road transport means  and vehicles and therefore Kredex was banned to secure loans that are used to buy road transport means and vehicles, this is exactly what happened.

Namely, the objective of the loan was for to acquire a company whose main assets were transport means. Although legally OK, Kredex essentially violated EU rules.
The agency’s internal auditor is currently conducting an audit of the activities of Kredex with regard to guaranteeing the loan. The findings of the audit are expected to be reported at the end of January.

After Autorollo stopped repaying the loan, Swedbank filed a bankruptcy application against it and the company was declared bankrupt in 2011. Swedbank received most of the loan in the amount of 330,000 euros back from Kredex which made Kredex Autorollo’s biggest creditor. According to Eesti Ekspress, Kredex considered the loan irrecoverable and sold it for 3,500 euros.

Rosimannus’ friend, lawyer Siim Roode who became owner of Autorollo in spring 2010 after the company developed financial problems, has said that Swedbank should not have granted the loan to Autorollo because it was obvious that the company was not able to service the loan.

Roode said that an audit also showed that the holding that Väino Pentus bought from Tiit Pohl was worth only half of what was agreed, or about 400,000 euros.
The creditors of Autorollo have now sued Keit Pentus-Rosimannus, Rain Rosimannus and Siim Roode, claiming more than half a million euros from them.

Paper: Enterprise Agency instructed Ericsson to break EU rules

An audit made by the Finance Ministry shows that the Estonian arm of Swedish manufacturer of telecommunication equipment Ericsson may have to repay EUR 1.2m for grant that it received from business support agency Enterprise Estonia, writes Eesti Päevaleht daily.

Ericsson that acquired the former Elcoteq assembly plant in Tallinn in 2009 for EUR 30m had applied for a grant from Enterprise Estonia to acquire new production lines and necessary software.

The total investment made by Ericsson was EUR 4.7m, but the problem was that the company started to invest it before the grant had been paid out.

According to the auditors, Enterprise Estonia was aware of the potential breach of rules, but had encouraged the manufacturer to go on with the investment regardless.

EU funding rules for grants require that investments are not made before the grant has been approved. The logic of this requirement is that if the company goes ahead with the investment before the grant has been paid out, taking such a risk means that the company could have managed also without such a grant.

“The letter sent by Enterprise Estonia to Ericsson Estonia on December 17, 2009, recommended that they go ahead with orders for equipment, with only the invoicing and payment to take place after the application was submitted,” said the auditors.
Ericsson is one of the 61 grant projects that, according to auditors, have been financed in violation of EU funding rules which means these grants can be reclaimed from recipients.

In several cases, Enterprise Estonia has retroactively re-classified the grants so that they fit with EU rules and regulations.

Enterprise Estonia has argued that the activity had not actually taken place before the application was submitted.

Raul Parusk, the acting head of Enterprise Estonia, has said that Ericsson had not started activities covered with the application before having received the yes from Enterprise Estonia.

Because of similar scandals, Ülari Alamets resigned two weeks ago as head of Enterprise Estonia.

Commenting news that Ericsson Eesti, one of Estonia’s largest foreign investors, may be forced to repay EUR 1.2m in a grant that it received from Enterprise Estonia, Seth Lacman from Ericsson Eesti says that  it would not be a problem.

In an interview to Aktuaalne Kaamera news program on ETV, Lackman said that the company had acted in accordance with the instructions received from Enterprise Estonia and is now waiting for the agency to offer a solution to the problem.

Lackman said that if the company is ordered to repay EUR 1.2m, it would be done.
Estonia has applied for a special permission from the European Commission to retroactively allow such derogation from EU rules, but it is most unlikely to be granted.

Tax authority to get tough with chronic tax debtors

the big joke… how MTA discovers this !!! after closing the eyes for so many years

 

 

gon Veermäe, deputy head of the Estonian Tax Authority, said yesterday that more than 150 companies systematically owe tax, writes Äripäev.

Veermäe said that the authority plans to introduce measures this year to reduce tax arrears which means that such companies that have chronic tax debts could be filed for bankruptcy by the state.

“We have analysed our receivable portfolio and seen that these companies have ongoing business activities, but do not pay tax as required. This year the state will take decisive measures against such companies,” he said, adding that the law has always allowed the tax authority to get tough on companies with tax arrears, but in practice it has been seldom used.

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Veermäe said that the combined tax debt of such companies grows in average by EUR 12m.

According to the tax authority, of about 18,000 new companies that were set up last year, around 5,800 started actual activities. Of them, about 600 or 12% are considered tax risks and could have been set up for various tax fraud schemes.

Of new companies set up last year, 28% paid tax in the total amount of EUR 15.5m.

Veermäe said that the tax authority is keeping an eye also on 300 high-risk enterprises.

“These problem companies cause the state to lose about EUR 70m a year,” he added, mainly as a result of VAT fraud and unreported salaries.

“This year, like last year, we plan to concentrate on those who inflict the biggest tax damages and that in our priority areas like construction, used car sales, forestry and food service and accommodation establishments,” he said.

Marek Helm, general director of the tax authority, says that VAT fraud remains a priority concern area and that 70% of the agency’s auditing resources is spent on VAT issues.

Last year tax authority collected EUR 4.76 billion in taxes which is 2.3% more than the 2012 target. This year’s target is a little more than 5 billion euros.