PM Tusk calls against politicization of state institutions as response to Amber Gold scandal
August 31, 2012
PM Donald Tusk
The lower house debate on Thursday was dominated by the recent scandal around Amber Gold investment company, whose founder was charged with illegal activities and fraud while PM Donald Tusk and Prosecutor General Andrzej Seremet reported on the latest development in the controversial case.
Based in the coastal city of Gdansk, Amber Gold offered its clients exceptionally high, up to 14 % interest on what it claimed were investments in gold. Instead of investing the money, it apparently used funds from new clients to pay off older clients.
The company also offered cheap flights via its budget airline OLT Express. In July OLT Express declared bankruptcy, while Amber Gold announced insolvency earlier this month leaving thousands deposit clients stranded.
Earlier Marcin P. was convicted nine times for various financial offenses, which, however, did not prevent him from setting up new businesses.
The scandal has raised questions about the effectiveness of the government and state structures. The case also brought hefty criticism on Poland's judiciary and prosecution, which undertook no steps against the enterprise despite knowledge about its dubious operations since 2009 and despite warnings from the Polish Financial Supervision Authority (KNF).
Earlier this month, when the scandal came to light, the founder of Amber Gold Marcin P. (surname withheld under Polish law) saw the Gdansk-based prosecutor's office press six charges of financial wrongdoing against him.
On Wednesday Polish prosecutors filed a new charge against him that he allegedly cheated his clients out of large sums of money.
The largest amount of money entrusted to Amber Gold by a single client was zl.3.2 million; 67 individuals bought certificates worth half a million zlotys, and 1,170 invested more than 15,000 euros.
Marcin P. is accused of defrauding at least PLN 182 million. If found guilty, he could face up to 15 years in prison.
Also under inquiry are several prosecutors who had earlier contact with the Amber Gold case and failed to react despite numerous complaints made to them about the company’s business activities.
Scrutiny has also focused on the prime minister due to business dealings his son had with Amber Gold owner.
The Thursday debate was opened by PM Tusk, who called for clarifying the mistakes of state institutions but stressed that it should not be used as a pretext for subjecting them to political control.
Instead, Tusk said, the Prosecutor General needs to have more independence. “We will empower the Prosecutor General or another institution, perhaps a court, with instruments, which will be able to effectively discipline and execute proper conduct from prosecutors.”
Some tax offices and consumer watchdog UOKiK are guilty of clear negligence in the case of Amber Gold, Finance Minister Jacek Rostowski said. Rostowski proposed a number of solutions aimed at preventing such fraud in the future.
Prosecutor General Andrzej Seremet admitted that the prosecution made mistakes. “We are all aware that this should have never happened, we all know today that many people won't be able to get back what they put into Amber Gold. We can only ask what the state structures can do to prevent this from happening again.”