Mark Lastik, the founder of the startup Eurora Solutions in Estonia, is currently only trial for defrauding Enterprise Estonia and squandering tens of millions of euros of investor money. Now he is facing another criminal case, this time for allegedly stealing support funds from the Archimedes Foundation.
Postimees reported back in January of last year that Lastik had targeted millions of euros from the Archimedes Foundation which were intended for projects related to national research institutions. Prosecutors say that in order to ensure this, Lastik needed one research institution and one reliable IT company that would be willing to take part in the scheme. Lastik had an IT company, Almic OÜ, which he had already used to manipulate funds from Enterprise Estonia. The main drawback, however, was that Almic was by no means a public research institution.
Lastik is alleged to have used the STACC software technology development centre as the main contractor, which would bring together reputable and unsuspecting researchers. STACC fully satisfied the criteria of the Archimedes support plans. There were no suspicions of foul play, assuming that the project’s viability would be examined by the foundation.
STACC appeared as the primary contractor in the contract with Archimedes, though the company lacked the capacity to perform the necessary IT development. Lastik was promising a new success story similar to Skype. To ease the concerns of scientists, the charges allege, Lastik proposed that most of the IT work would be handled by Almic OÜ, and most of the funds would be directed to it. This, too, did not raise any red flags for the scientists.
Late in 2018, Lastik and his company, which was then known as Aurora Solutions OÜ (since then becoming Eurora Solutions OÜ, which has gone bankrupt), applied to Archimedes for EUR 1.39 million in support to conduct an applied research project aimed at digitising VAT and customs declarations in E-commerce. As a supposed public research institution, STACC was in the leading role, and the funding was requested for research and development. Archimedes did not suspect any foul play and approved the funding application. Total funding came to EUR 1.3 million. The applicant was required to provide some EUR 700,000 in co-financing.
The funds flowed from Archimedes on to Eurora and then to the STACC account. Because the sums were substantial, Eurora created a special ledger for monthly financial transactions labelled “in” or “out.” According to the ledger, Eurora paid STACC, which kept a small portion of the funds for itself and sent the rest to Almic. Almic, in turn, transferred significant amounts back to Lastik’s company.
The success of the entire scheme relied on the fact that IT development was occurring, and Eurora was accessing it. Archimedes, which has since become the State Shared Service Centre (RTK), considered Eurora to have been a success story. The truth is, however, that Eurora’s “success” turned into a bankruptcy case which erased tens of millions of euros in investments. It has also been determined that Lastik diverted the money to a company which he controlled, thus mirroring the fraudulent manipulation of Enterprise Estonia funds, which had occurred before. The new case is now under similar judicial scrutiny.
The European Public Prosecutor’s Office has launched a new criminal investigation. Agency spokeswoman Paula Telo Alves remained tight-lipped, only saying that as a rule, her agency does not comment on ongoing investigations or publicly confirm or deny cases which it is handling.
Source: BNS
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