Bribes give acquaintances the edge

Photo: Mihkel Maripuu / Postimees

Long-time Technical Director of the North Estonia Regional Hospital (PERH) Ivo Mill is suspected of preferring two construction and one design company for the hospital's construction procurements for which he received more than €50,000 in bribes in just a few years.

Mill, who has been part of the management at PERH for over 11 years, is the second hospital executive in six months to have corruption charges brought against him. If former hospital head Tõnis Allik is connected to accepting various gratuities from IT companies and caterers, charges against experienced construction sector participant Mill are far more typical in nature.

Investigative organs suspect that Mill was able to accept more than €50,000 in bribes over the years in exchange for making sure a set of companies were successful at hospital tenders. The total volume of the procurements exceeds €10 million that would leave Mill with a 0.5 percent cut.

This margin might have remained undetected had there not been one conspicuous nuance: PERH's construction tenders seemed to favor AS Kose Ehitus that was handed two orders inside two years for a total of more than €4 million.

Suspicions at RKAS

The successful participation of the company raised questions as the hospital's technical director had served on the company's board in 1997-2003. Things seemed less than coincidental. Mill is no ordinary functionary in the construction business: before landing at PERH, he headed the construction department of state real estate manager RKAS.

He was forced to leave that post in early 2005. Head of RKAS at the time Tiit Ottis suspected Mill and the entire department of corruption and even filed a report of a criminal offense with the prosecution. While the investigation ended up nowhere back in 2005, Mill's luck seems to have run out at PERH.

The Central Criminal Police's corruption crimes bureau spent months investigating Mill and decided to lay its cards on the table this week. Mill, who is alleged to have approached companies and asked for bribes himself, was detained on Monday morning. His home and office were searched.

Suspicions of violation of public procurement rules and fraud, repeated accepting and asking of bribes, falsification of documents, use of falsified documents, and money laundering were brought. Mill tried to hide the origin of the bribes through other transactions.

The police also interrogated one of Mill's subordinates, the construction project manager, as another suspect. They are suspected of fraud and violation of public procurement rules. Information available to Postimees suggests that Mill's accomplice was not paid.

“We have reason to claim the suspicions concern several companies that have taken part in public procurements and their representatives. This will result in suspicions against several legal persons,” said leading public prosecutor Steven-Hristo Evestus.

Postimees' information suggests one of the said companies is Mill's former employer Kose Ehitus. Another is also active in construction, with a design bureau coming in at number three.

The prosecution, according to which Mill cooperated during questioning, will move for the executive's arrest today, while it sees no reason to arrest Mill's accomplice.

Both are still employed at PERH, while chairman of the board Agris Peedu has stripped away the suspects' right to participate in the work of procurement committees, sign contracts, authorize payments and instruments of delivery and receipt.

“The board of the hospital will adopt a position concerning future steps in the coming days, after it has had the chance to talk to the persons in question,” Peedu said when asked whether the suspects would be allowed to continue at the hospital.

Preventative measures in place

Peedu said that the hospital is cooperating fully with investigative organs and will employ all measures to prevent corruption: “We have already launched corresponding activities: we will update our procurement process, purchase management, risk management, and internal control.”

Head of the central criminal police's corruption crimes bureau Mati Ombler recommended hospital executives be more careful in the future. “Our recommendation to heads of agencies is to be even more vigilant in terms of the activities of employees in charge of procurements, to consider corruption risk assessment, and mechanisms to curb risks of becoming victim to or committing crimes,” he said.