When the previous Estonian prime minister, Jüri Ratas – also the chairman of the centre-left Centre Party – resigned on 14 January, he did so because his party had yet again been suspected in criminal involvement in a corruption case; this wasn’t by far the first time the Centre Party – now again in the current government – has been suspected, and also prosecuted and found guilty, in corrupt deeds.
On 12 January, the Estonian Public Prosecutor’s Office announced it suspected the Centre Party and five individuals, including the party’s secretary-general, Mihhail Korb, were involved in a corruption case.
According to the suspicion, Korb had asked the Estonian businessman, Hillar Teder, to support the party with up to €1 million within a year – in return for the €39 million loan to Teder’s Porto Franco real estate development by the Old City Harbour in Tallinn. The loan was granted by Estonia’s state credit agency, KredEx.
But because of the huge amount, KredEx’s loan decision needed an approval by the coalition government – comprising of the Centre Party, the Estonian Conservative People’s Party and Isamaa – which it received in July 2020.
Teder, indeed, supported the Centre Party in 2020. As of January 2021, he had donated €120,000 to the party since Porto Franco received the loan in summer 2020. In addition to Centre Party, Teder has since 2013 also supported the Reform Party, Isamaa and Social Democrats, with over €1.2 million in total.
A party resigns from the government for corruption, gets invited to the next government
Porto Franco said in 2020 it needed the loan because the business was hit by the coronavirus crisis. Even at the time of the loan’s approval, it raised many eyebrows in Estonia – many analysts pointed out there were many businesses that struggled as much, if not more.
The scandal prompted Korb’s immediate resignation on 12 January, and, at around 3AM on 13 January, also the prime minister, Jüri Ratas, announced his resignation. According to the Estonian electoral system and law, when the prime minister resigns, the entire government does so, too, which marked the end of the coalition.
The Estonian weekly newspaper, Eesti Ekspress, earlier this year compiled a massive list of every criminal case the Estonian Centre Party has been involved with. This is even more relevant today because the new Estonian government – the one negotiated and inaugurated after Ratas’s resignation – again includes the Centre Party.
The coalition is led by the Reform Party, chaired by Kaja Kallas, who is also the current prime minister. The Centre Party is the junior partner in the coalition and the Reform Party formed the coalition despite the Centre Party’s most recent corruption scandal and its long list of previous corrupt affairs.
Kallas reasoned her party’s decision on favouring the Centre Party above others, by arguing that Isamaa’s current leadership had been hostile towards forming the government with the Reform Party, instead preferring to continue with the previous coalition. However, Isamaa’s leader, Helir-Valdor Seeder, has rejected this claim, saying the Reform Party never approached them.
The first time the Centre Party was punished for criminal activity was in October 2014 when the then-party secretary-general, Priit Toobal, had forged the party’s money income orders and the party had gained €11,000 of unknown origin. The Centre Party, Toobal, the party’s MP Lauri Laasi and an official named Ivar Onksion were all convicted. The Centre Party had to pay a €10,000 fine.
In September 2019, the Centre Party was convicted in accepting a forbidden donation – a €275,000 loan from businessman Hillar Teder. The party needed money and Teder needed to exchange a real estate property with the city of Tallinn – where the Centre Party has and is ruling. The party was fined €275,000, but the court later changed it to only €25,000.
The Centre Party and dark money – who could separate them!”
The Centre Party’s previous chairman, Edgar Savisaar, was at first also prosecuted in the case, but he got off for serious illnesses he was suffering from – or claimed he was suffering from.
According to Eesti Ekspress, if the Centre Party will be convicted this time for the Porto Franco scandal, it will also be punished for the last crime and will have to pay the additional €250,000 – because this new crime was perpetrated while the party was on parole.
In addition to the convictions, the Supreme Court in 2020 affirmed the decision by the parliament’s committee responsible for enforcing party finances that the Centre Party will have to pay the state €110,100 – money with an unknown source that was donated to the party.
Right now, the Centre Party is going to court with the same parliament’s committee in a case where the committee ordered the party to pay back €1.27 million to a marketing company for advertising campaigns – that, too, was considered as a forbidden donation.
The weekly newspaper points out that the party’s colourful history points to recidivism – in medicine, the word means a reoccurrence of the same illness after a supposed recuperation; in law, it stands for being convicted and punished for multiple similar crimes. “The Centre Party and dark money – who could separate them!” Eesti Ekspress notes.
In the current government, the Centre Party’s politicians have assumed the duties of the social affairs, economic affairs and infrastructure, internal affairs, foreign affairs, culture, environment and public administration ministers.
Cover: Smoke and mirrors: the Centre Party’s leader, Jüri Ratas, giving a speech at a Centre Party’s local election campaign trail in 2017. Photo by the Centre Party’s official Facebook page.