Estonian foreign minister still haunted by murky bankruptcy case (2)

Keit Pentus-Rosimannus Postimees/Scanpix
2/27/2015 10:07 AM
Category: Society

ETV's “Pealtnägija” program reported that the family of cabinet minister Keit Pentus-Rosimannus is involved in a lengthy battle in which the opposite side accuses them of deception.

Estonians Teet and Ülle Järvekülg are a couple who own a company called Port One. With their annual 30-million-euro revenue, they are among the wealthiest Estonians.

But it wasn't the wealth that put the couple in the spotlight. Their firm provided fuel to a company called Autorollo, the trucking company formerly owned by Keit Pentus-Rosimannus's father Väino Pentus. When Autorollo went bankrupt, it owed hundreds of thousands of euros to the Järvekülgs. The couple, reported "Pealtnägija," is the only one who dares to press proceedings against one of the most influential political families in Estonia. After the court hearings, the couple has now decided to go public with their accusations against the Pentus-Rosimannus family because they feel disillusioned with the previous criminal investigation into the matter.

The Autorollo scandal, as it is known in Estonia, first caught the public eye in 2012. That a company goes bankrupt is nothing unusual, but the public attention in this case came from the fact that before the bankruptcy, Autorollo was drained of money over a short period from 2010-2011. A large amount of money was withdrawn from the firm's account and some of the bank transfers were made from the personal IP addresses of Keit Pentus-Rosimannus.

A Harju County Court hearing on Autorollo's bankruptcy in 2013 established that money from Autorollo account was transferred from IP addresses that are located in the Parliament building at a time when both Keit and her husband Rain Rosimannus, widely regarded as a principal mover and shaker in the governing Reform Party, were MPs. Some of the transactions were made at the time when Väino Pentus was hospitalized and Keit Pentus-Rosimannus claimed later that she merely helped her father.

Keit Pentus-Rosimannus and Rain Rosimannus did not attend court at the time and were represented by lawyers. “Pealtnägija” disclosed that they refused to attend court on the grounds that they cannot testify against their father and father-in-law respectively. As explained later in this article, Väino Pentus testified at one point in court that part of the money that was intended for Autorollo was used to build Keit Pentus-Rosimannus's house instead; he later recanted.

When Keit Pentus-Rosimannus was first confronted about the case by Estonian business paper Äripäev, she denied any involvement at all in the firm's affairs. Yet the trustee in bankruptcy claimed otherwise.

In July 2014, the Harju County Court reached a ruling. The court struck down the lawsuit filed by the Autorollo bankruptcy committee against then minister of environment Keit Pentus-Rosimannus, but agreed with a part of the damages claim against her husband Rain Rosimannus and against Autorollo's lawyer Siim Roode. The court found that the plaintiff’s claim was partly justified and would have to be partly satisfied. The bankruptcy committee had earlier demanded that the defendants pay back almost 600,000 euros.

Ülle Järvekülg told “Pealnägija” that their objective was honest and straightforward and any attempt to search a political motive or intrigue was baseless. “The reason that we have gone public with this matter is not because we are trying to hurt the Pentus-Rosimannus family. Rather, it is they who are hurting us.”

Järvekülgs said that it was only two weeks ago that they had finally had a chance to see the criminal investigation materials in the Autorollo case and that they were disappointed. “I'm obliged to say that it is possible to influence the investigation in Estonia,” Teet Järvekülg said.

ETV's “Pealtnägija” also asked Keit Pentus-Rosimannus and Rain Rosimannus to comment on the matter, but they refused. Rain Rosimannus claimed that the accusations are all part of election campaign. “I do not want to take part in the smear campaign that has been conducted and financed by millionaire Järvekülg family against me and my family,” he wrote in a message, adding that Järvekülgs have either a political or personal motive.

Yet the Järvekülgs deny a political motive. “There is no difference whether it is Reform Party or Center Party, I can't stand fraudsters,” Teet Järvekülg said, confirming that no political party had asked him to sue Pentus-Rosimannus family. “All we want is justice and to make sure that no such bankruptcy cases would happen in the future,” he added. His wife said that she was previously a Reform Party voter.

"Pealtnägija" disclosed that the scheme behind Autorollo bankruptcy case goes back a long way and Rain Rosimannus was involved since 2008. In that year, Väino Pentus decided to buy out his partner in the trucking business. In order to proceed, he borrowed 11 million Estonian kroons (about 700,000 euros) from Swebank, 75% of it secured by the state-owned Estonian Credit and Export Guarantee Fund Kredex. It was reported that banks were hesitant to issue the loan to him, but ultimately decided to, thanks to Rain Rosimannus being an influential Reform Party MP at the time.

It became clear later that the massive loan, taken in the middle of the recession, proved fateful to the company. In 2009, Autorollo failed to keep up with making payments to its creditors. However, Järvekülg's firm continued to supply the trucking company with fuel cards (used to buy fuel for long-haul trucks around Europe) until 2010, as it was their old client.

When debts had mounted to 1.5 million kroons (100,000 euros), the Järvekülgs started to chase their money. As Väino Pentus was hospitalized, they were contacted by Siim Roode, a lawyer employed by the Pentus-Rosimannus family. According to Järvekülgs, at the first meeting, Roode proposed that they take part in a scheme to transfer all the Autorollo liquid assets to other companies and therefore free them from claims by other creditors. “It was clearly a scam and we didn't approve it. Our response was straightforward – pay the owed money back and we will all happily depart,” Teet Järvekülg said.

But the people in charge of Autorollo pursued the schemes without the Järvekülgs. The firm was stripped of assets and went bankrupt, followed by Väino Pentus's personal bankruptcy. In a most curious case, the professional creditors (banks and Kredex) who suffered the biggest losses, just gave up and forgave the loans. But Järvekülg's company Port One bought up all the other claims to ensure that the bankruptcy proceedings would continue. “It was a principal question for us – how Autorollo was let to go bankrupt and the scam behind it. Whether there was an influential family behind it or not, this did not play any part,” Teet Järvekülg said.

Although Pentus-Rosimannus has insisted that her sole “blame” in the case is that she is the daughter of the former owner of Autorollo, the Järvekülgs maintain that she and her husband were much more deeply involved than they have admitted. “There is testimony from many people, including the truck drivers and former board members of Autorollo. It is actually pretty clear what has happened, people are not stupid,” Järvekülgs said.

Järvekülgs filed a lawsuit in 2012, in which they claimed almost 580,000 euros from Keit Pentus-Rosimannus, Rain Rosimannus, and their lawyer. The Järvekülgs argued that the prominent political family used a scam to hide money, behaved like bogus firm directors and eventually asked Siim Roode to let Autorollo to go down the drain. It was after filing the lawsuit that the media learned about the case. When Äripäev approached Pentus-Rosimannus in 2012, she appeared to disassociate herself completely from the company.

It later emerged that money - sometimes as much as 50,000 kroons in cash (over 3,000 euros) per day - was taken out from the company, without any record of the purpose. From autumn 2008 until spring 2010, hundreds of cash withdrawals of 10,000 kroons (640 euros) were taken out from cash machines, on average three to five times per day. Most of the time, the cash machines in the Tallinn's Pirita and Viimsi district were used.

Keit Pentus-Rosimannus's house is located in Viimsi and her father first said at the court hearings that he gave the cash, taken out from Autorollo, to his daughter, so she could pay back her mortgage. However, after Pentus-Rosimannus categorically denied this in the media, her dad also changed his testimony.

“They simply lie,” Ülle Järvekülg said. “The amount that was withdrawn totals about 224,000 euros. In my opinion, had this cash not been taken out from the company, Autorollo would have not gone bankrupt,” Teet Järvekülg added.

Keit Pentus-Rosimannus prevailed in all facets of the civil case. Rain Rosimannus was partly found at fault, but he called the court ruling absurd and appealed. But at the same time, there is a criminal investigation going on in the matter. Järvekülgs saw the materials for the first time two weeks ago and to their dismay, only Väino Pentus and Siim Roode were named suspects.

Järvekülgs call it “an Italian investigation." For example, Keit Pentus-Rosimannus was called to testify at the prosecutor's office only in September 2014, where she refused to testify, on the grounds that the criminal investigation is against his dad. Her husband was asked to do the same even later in the month and also refused on the same grounds. It all happened two years after the initial criminal investigation was started.

“Secondly, the investigation has not even tried to find out where the money has actually gone – where the 224,000 euros is that was taken out in cash in daily installments,” Teet Järvekülg said.

There is another issue. The criminal case was originally started two years ago by a former prosecutor named Dmitri Teplõhh, but Teplõhh is now working as a lawyer and is representing Väino Pentus in court. Järvekülgs said that this is the most bizarre aspect. “As a prosecutor, Teplõhh had access to all the sensitive data and investigation details in relation to the Autorollo case, yet he is now working for the defendant.”

Järvekülgs also said that their motive to proceed against Pentus-Rosimannus family is not financial, as the court case may prove more costly eventually, but based on principle.

“We have been honest and we know that we are doing the right thing. We will not stop, but carry on until justice prevails,” Järvekülgs said. The case continues.

S. Tambur

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