Finance Ministry finds no conflicts in state IT procurements

Latvia’s Ministry of Finance found no conflicts of interest in procurements for nationally significant information technology systems, LSM reported. The finding is included in a report approved by the government on Tuesday.

Using analytical procedures and data available to the ministry, including information from the State Revenue Service, the audit assessed potential conflicts of interest involving more than 1,600 people who had participated in procurements organised by the State Digital Development Agency or were connected to those participants. It identified no signs of conflicts of interest.

The audit also analysed data submitted on potential conflicts of interest involving procurement committees for information systems overseen by the State Digital Development Agency. The Ministry of Finance assessed the potential conflict-of-interest risk as medium under the Public Procurement Law.

At the same time, the audit found circumstances corresponding to the three elements of the classic fraud triangle: opportunity, pressure and justification. It said measures should therefore be taken to prevent or at least reduce dishonest conduct.

The audit examined nine companies that had won procurements for projects financed by European Union funds: ABC software, Dativa, RIX Technologies, Baltic Software Factory, Datorzinību centrs, Corporate Systems, Digitex, Codex and Dati Group.

The review covered the companies’ owners, including legal entities holding at least 10% of their shares, as well as officials, commercial agents and historical information from the Enterprise Register dating back to 2019. It also examined first- and second-degree relatives of the companies’ owners, officials and other authorised persons in relation to employees of the State Digital Development Agency and the Ministry of Smart Administration and Regional Development between 2019 and 2025.

In total, the audit examined family and employment links involving 642 company officials and their first- and second-degree relatives, compared with more than 1,000 employees of the State Digital Development Agency and the Ministry of Smart Administration and Regional Development who worked during that period and could have served on procurement committees.

The audit also concluded that information-system development in Latvia had so far been highly fragmented, as had oversight of that development.