Kostas Mikalajūnas, director of Dankora, a company owned by the sister-in-law of Lithuania's outgoing Prime Minister Gintautas Paluckas, has been detained as part of a pre-trial investigation into credit fraud, the Financial Crime Investigation Service (FNTT) said on Thursday.
The agency stated in a press release that Mikalajūnas was taken into custody during a law enforcement operation earlier in the day, and a decision is pending on whether to impose a preventive measure.
The probe, led by the FNTT and overseen by the European Public Prosecutor's Office, centres on allegations that Dankora fraudulently secured over €136,000 in European Union financial support, potentially involving forged documentation.
Mikalajūnas initially owned Dankora but later sold his stake to Virginija Paluckienė – the wife of the outgoing prime minister’s brother, Danas. Paluckienė currently serves as director of the Palanga Resort Museum.
In February, Dankora launched a procurement tender for battery systems and two inverters. The sole participant and winner of the tender was Garnis, a company in which Prime Minister Paluckas holds a 49 percent stake.
Responding to questions last week, Mikalajūnas insisted that all procurement procedures had been “public and transparent” and claimed that Paluckas “is not involved in any form” in the company’s operations.
Nevertheless, Dankora subsequently announced it would return the EU funding, stating that “the peace of mind of the families and loved ones is more important to the company’s director and shareholders than money.” The company pledged to complete the project using its own resources.
On Thursday, the FNTT carried out “dozens of searches and other procedural actions” linked to the case, including at Dankora’s registered office, the homes and vehicles of directors and shareholders, and various other locations, first reported 15min.
“Documents and other items relevant to the investigation were taken. Searches are also underway at other potentially linked companies in Lithuania,” the agency confirmed.
The scope of the investigation also encompasses suspected misuse of a €200,000 soft loan from Lithuania’s national development bank, ILTE, to Garnis. Authorities suspect the funds may have been channelled to Emus, a battery technology company also co-owned by Paluckas but ineligible for such a loan under ILTE’s criteria.
“The investigation is being conducted very actively, with numerous procedural actions underway. The number of detained and suspected individuals may increase,” the FNTT said.
Further details will be released when it no longer risks compromising the investigation, the agency added.
The developments come as Gintautas Paluckas, under intensifying pressure over his business dealings, announced his resignation on Thursday both as prime minister and as leader of the Lithuanian Social Democratic Party (LSDP).
In line with Lithuania’s Constitution, Paluckas’ resignation requires the entire Cabinet to step down. The coalition agreement between the Social Democrats, the Democrats “For Lithuania”, and Nemunas Dawn will also need to be amended to include the name of a new prime minister. The Democrats have indicated they may seek broader changes to the ruling coalition’s composition.
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