Forevers boss Andrejs Ždans benefited from Latvia’s prosecution ‘leniency system’ under Juris Stukāns
Another confirmation has appeared regarding the news about the prosecution’s “special clients” during the time it was headed by Prosecutor General Juris Stukāns: Pietiek has obtained an interrogation protocol dated November 5 of last year, in which businessman Sergejs Vojevoda gave detailed testimony to the prosecutor of the Tax and Customs Prosecution Office, Liana Čakārne, describing how his “cooperation” with the owner and director of the meat processing company Forevers, Andrejs Ždans, took place in organizing and implementing value-added tax (VAT) schemes.
From this testimony, it clearly follows that A. Ždans was the initiator and beneficiary of these VAT schemes. However, as Pietiek has learned, although more than six months have passed since this testimony was given, no instructions have followed from the prosecutor’s office to the law enforcement institutions. Such a “lenient” attitude fully corresponds to previously disclosed information about how, during J. Stukāns’ tenure, the prosecution had its own “special companies and businessmen.”
Pietiek has already reported that several years earlier, the same S. Vojevoda had testified about specific persons — namely Vitautas Teličens and Gints Lazdiņš — whose organized schemes caused the state to suffer losses of at least one million euros in the Daugavpils dzirnavnieks affair. Yet, again thanks to the “leniency” of the prosecutor’s office and the police, the criminal proceedings were terminated once more — the investigation was satisfied with the statements of both that they knew nothing about any fraud.
Today, Pietiek publishes in full the testimony of S. Vojevoda, “kept on hold” by the prosecutor’s office, given on November 5 of last year:
“I have known Andrejs Ždans since around 2012 or 2013, when he was a board member and the actual head of SIA Forevers. At first, our children became friends, and later I got to know him, and we developed business relations. At that time, I had contacts related to meat supplies; I knew some European traders. Andrejs found out about this and became interested in my contacts. He told me he would provide financing, but I would need to set up a ‘compressor’ — by that, I mean a tax optimization scheme.
At Andrejs’s request, I had to create companies — VAT payers — through which SIA Forevers would further purchase meat from producers in the European Union for its needs and resale. Andrejs wanted me personally to represent these companies. I had been involved in buying and selling goods since I was 16 years old and had business experience. I agreed, although I realized that by helping Andrejs Ždans, SIA Forevers would gain the opportunity to buy meat more cheaply due to paying less tax.
The essence of the scheme was as follows: meat was purchased from the European Union (both from producers and traders — “brokers”), and the purchase price was not subject to VAT, meaning it was sold with 0% VAT. The purchase was formally recorded under SIA Evodia as the buyer.
In reality, Andrejs Ždans gave me orders on how many kilograms and what kind of meat he needed, and he transferred money to SIA Evodia, which I then used to buy meat from EU sellers. Specific orders were handled by SIA Forevers employee Sergejs Semeņecs, who informed me of the prices offered by other suppliers.
My task was to find a meat price (for example, on the EU meat exchange) that would be lower than the price offered to A. Ždans. My condition was strict — I would order meat for SIA Forevers only with 100% prepayment. Payment to EU meat suppliers was made through SIA Evodia.
SIA Forevers is a large production company, and Andrejs Ždans had information about where meat could be purchased directly, without intermediaries. A. Ždans’s benefit was that SIA Evodia formally sold meat to SIA Forevers with 21% VAT and even cheaper than the purchase price. Thus, SIA Evodia had no actual profit in buying meat and then reselling it to SIA Forevers, including VAT in the price. The 21% VAT that SIA Evodia was supposed to pay into the state budget, I “cleaned,” that is, reduced on the basis of fictitious transactions with SIA VKR 7 and SIA DUAN, for which I am now charged.
Both of these companies were created at my request by my acquaintance Vadims Žaivoronko. Neither from SIA VKR 7 nor from SIA DUAN did my company, SIA Evodia, ever buy soy isolate; it existed only in the documents and VAT declarations, but in reality, the goods were neither bought nor sold. I admit that the entire transaction scheme between SIA Evodia, SIA VKR 7, and SIA DUAN was needed to fictitiously reduce the VAT that arose from transactions with SIA Forevers.
I mainly ordered meat for SIA Forevers from the Polish company Super Smak SP Zoo. The delivery documents, according to the information I provided about the place of delivery and the recipient, listed SIA Forevers in Riga, Granīta Street. SIA Evodia never physically received the meat — it was delivered directly from the producer in Belgium or Germany to SIA Forevers. Considering this, the actual sale transactions between SIA Evodia and SIA Forevers never took place.
Later, I do not remember exactly when, A. Ždans personally told me that his consultants from the State Revenue Service advised that another company or several companies should be placed between SIA Forevers and me, so that the meat purchase scheme would look more credible. That is, there should be a real operating company with a good history and one related to the food industry, so that SIA Forevers could formally record the meat purchase through it. A. Ždans informed me that such a company would be SIA HimLat, which at that time supplied soy, spices, and salt to SIA Forevers. Another such company was SIA Mega DVD and SIA LVBS. On my part, I used my own companies, SIA Lat Build Holding and SIA Lat Export Holding.
Later I learned that both SIA Mega DVD and SIA HimLat were subject to large tax surcharges and audits. A similar scheme was implemented with SIA NPS Building and SIA Emimar, which were declared as SIA Evodia’s business partners. The real beneficiary of the scheme was Vitautas Teličens, to whom I provided the same kind of service as to A. Ždans. I am ready to provide testimony about other companies on another occasion.”
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