In January 2009, outgoing Prime Minister Ivars Godmanis appointed Normunds Vilnitis as Loskutovs' replacement, with parliamentary approval. A former law professor and law enforcement official, Vilnitis quickly aroused controversy. KNAB Deputy Director Vilks cited "rumors [that Vilnitis] was sent by politicians simply to make the work of KNAB worse." Vilnitis exerted authority over long-time KNAB staff, issuing formal complaints against Strike and Vilks for insubordination and incompetence, and accusing them of foreign espionage. Both Prosecutor General Maizitis and Delna lobbied to remove Vilnitis, but the new prime minister, Valdis Dombrovskis, was reluctant to intervene.
Seeing Vilnitis as an internal threat to KNAB, bureau veterans defied his orders and cut him out of sensitive operations. Under Vilnitis' nose, they pursued their high-level investigations, despite security threats such as the discovery of a Russian smuggling syndicate's assassination plot against Strike, which briefly forced her to leave the country.
KNAB's efforts paid off in May 2011 with the first search raids and arrests in a massive operation that the press dubbed the "Oligarchs Case." The case ensnared 26 companies and 11 defendants, including six officials, in a complex web of kickbacks and hidden assets. All three oligarchs faced serious charges. The case added fuel to public fury over state capture, becoming a public symbol of oligarchic excess against the backdrop of a painful economic crisis.
When KNAB's investigations reached Slesers, his parliamentary immunity protected his property from search and seizure. Public outrage exploded. On May 28, President Valdis Zatlers called for a referendum to dissolve parliament, specifically naming the three oligarchs as threats to Latvian democracy. "In a sense, everyone knew it, but it was brave that he said it so decisively," said Rasma Karklina, a Latvian parliamentarian. Delna organized a rally outside of parliament that attracted thousands to protest the oligarchs, and proposed a list of "The First 10 Steps to Recover the Stolen Country." The first step was to dismiss Vilnitis as KNAB director.
Parliament conceded and dismissed Vilnitis. According to Karklina, "parliament was getting dissolved, so deputies who previously had been reluctant [to dismiss him] were trying to position themselves as good guys before the [September 2011] election." Election results gave Lembergs' party 13 percent of parliament; Slesers' party won no seats; and Skele's party was bankrupt after losing court battles with KNAB over campaign finance violations. For the first time, a government coalition formed that involved none of the oligarchs' parties.
The anti-oligarch wave that began in 2010 opened a window of opportunity for KNAB to push long-stalled legal reforms, including the criminalization of campaign finance violations, judicial reforms to expedite trials, whistle-blower protections, and the lifting of parliamentary immunity for administrative offenses. Perhaps the most ambitious reform was the 2012 passage of the Zero Declaration Law, which required all residents of Latvia to declare all assets valued at more than $18,500 (including assets abroad), to curtail the underground economy, and prevent public officials from hiding tainted assets by transferring ownership to friends and relatives.
KNAB's successes depended on a strong leadership team. The agency performed best, and built its strongest public credibility, when the leadership team worked in an atmosphere of harmony and mutual trust. This trust required strict controls and management of internal corruption risks, preventing the lapses that led to Loskutovs' dismissal and blemished KNAB's reputation.
KNAB's experience showed the important roles played by the public and by powerful allies like the president and prosecutor general. KNAB won this support by strengthening media relations, achieving tangible results, and demonstrating independence and integrity. Ultimately, KNAB's survival and entrenchment within the Latvian state helped curtail high-level corruption and drive a broad-based wave of reform that helped level the playing field of Latvian democracy.