Police complete probe into alleged years-long legal advice fraud

Latvia’s State Police have completed an extensive investigation into possible prolonged and systematic fraud by an organised group that promised debtors help with starting insolvency proceedings, LSM reported. Fifty-seven people have been recognised as victims.

The criminal process was launched only after a report by LTV’s investigative programme De facto, although the Legal Office for Insolvency Matters had previously come to the attention of state institutions. Three people are suspected in the case.

Five years ago, Edite owed creditors several thousand euros. Unable to manage her debts, she searched online for legal assistance and saw advertisements on social media for the Legal Office for Insolvency Matters, known by its Latvian abbreviation JBMNJ.

The advertisements promised leading specialists and experienced lawyers. They told clients that, once cooperation with the office began, they could stop paying their creditors. Edite filled in an application form and was contacted by an employee of the firm, Laura Audejeva.

Seeing no other way out of her heavy debt burden, Edite signed a contract. However, lenders continued calling her and even threatened to block her bank account. She nevertheless trusted the office and paid it 170 euros every month for a year.

“They did not call any creditors at all. Of course, the debt kept growing. In reality, they did nothing,” Edite said. She described the promises as false and said that not paying her debts only worsened her situation.

She also recalled paying the firm 120 euros in cash. When she asked whether she should transfer the money, she said she was told that cash was required. According to Edite, Audejeva put the money in a drawer and told her that no receipt was needed.

Nearly two years after signing the contract, Edite was told that she could not start insolvency proceedings at all. The restrictions had existed from the beginning, but the advisers she had paid did not tell her, she said.

Edite was one of several people in financial difficulty who became involved in the firm’s scheme. Two and a half years ago, several people who said they had been defrauded by the legal office shared their experiences with De facto.