Former HKScan Estonia executives Teet Soorm and Mati Tuvi, suspected of large-scale embezzlement and money laundering, announced yesterday that they categorically deny having committed acts in question.
Soorm and Tuvi maintain that all relevant transactions and management decisions made over decades happened with the knowledge and approval of HKScan management organs and those of its owner. “What we have here is a punitive operation by incompetent yet hugely ambitious HKScan executives,” the men write in a letter to the public.
Teet Soorm has never attempted to hide the connection between his family’s businesses and HKScan subsidiaries Rakvere Meat Processing Plant and Tallegg. Companies belonging to his father, sister, and former classmate Margo Kuusk have been selling pigs, eggs, and cereals to HKSCan’s businesses in Estonia for years.
Even though Soorm last told Postimees he has never been involved in that business and that all companies have separate boards and owners in an interview a mere week ago, as a former HKScan executive he clearly played an important part in creating and maintaining business contacts.
Cooperation of many years ended abruptly when Jari Latvanen took over as CEO of HKScan in late October.
The group’s Finnish manager was replaced and Soorm fired in November. Latvanen said at the time that it was first and foremost a question of business ethics as several contracts had interested parties on both sides of the table.
Wednesday saw official suspicions of large-scale embezzlement and money laundering brought against Soorm and former pig farming division head Mati Tuvi, who was also fired from HKScan. A judicial mortgage of €65,000 was placed on Soorm’s terraced house in Viljandi in favor of AS Rakvere Farmid in February. Tuvi was notified of prohibition to dispose of profit yielding land in Põlva county on the same day. Data from the land register suggests the men do not own other real estate.
Embezzlement and money laundering
One of the companies involved is OÜ Tarva Konsultatsioonid the main areas of activity of which are investing in agricultural companies and consultations. The company is owned by Soorm’s father Ain Soorm who left his seat on the board in November. The only remaining board member is Teet Soorm’s sister Karin Soorm who told Postimees she has neither the time nor desire to comment.
Karin Soorm is also on the board of OÜ Ovolex that engages in poultry farming in Martna, Lääne county. Tarva Konsultatsioonid is one of the owners of Ovolex. The latter’s annual report states it is a partner of AS HKScan producing hatching eggs for its hatchery. The company made a profit of €28,000 with a turnover of €342,000 last year.
One of the biggest companies with ties to the suspects is OÜ Lõpe Agro that is owned by the Soorm family, Mati Tuvi’s family, and Teet Soorm’s former classmate Margo Kuusk.
Ain Soorm has a stake in Lõpe Agro through Tarva Konsultatsioonid. Tuvi is connected to the companies through Kalda Invest OÜ regarding which the Harju County Court had issued a notation
concerning prohibition in the business register by yesterday. Kalda Invest is a company founded by Mati Tuvi and his wife Lilian Tuvi that is now owned by the latter’s father Vahur Laul.
It is probable that most HKScan contracts were with Lõpe Agro. The group has a 100 percent stake in three subsidiaries: LA Holding OÜ, Tõhela Agro OÜ, and Paadremaa Agro OÜ.
Lõpe Agro’s main area of activity is pig farming, while it also produces cereals and feedstuffs and breeds poultry. The group has a dairy farm in Tõhela village in the former Tõstamaa rural municipality (now Pärnu – ed.), pig farms in the Kihlepa village in the former Audru rural municipality (now Pärnu – ed.) and Lõpe village in the former Koonga rural municipality (now Lääneranna rural municipality – ed.), as well as a poultry farm in the village of Koonga in the former Koonga rural municipality.
Pigs, eggs, cereals
All this gave HKScan the chance to offer versatile products and services. Lõpe Agro’s previous annual reports details how many pigs, eggs, and cereals were sold to companies owned by HKScan as an important business partner.
In 2015, the Koonga poultry farm sold over two million eggs to HKScan and 14,462 pigs to AS Rakvere Farmid. HKScan was also sold 1,400 tons of wheat and 300 tons of barley in 2014.
While Lõpe Agro has shown stable profits of around half a million euros in recent years, it reported a loss of €80,000 last year. Turnover dropped from €4 million to €3.6 million last year.
While it is possible no connection exists with financial results, the company’s annual report for 2016 no longer details quantities sold to HKScan companies.