Estonia's Versobank has license pulled over money laundering

Take note – story published 6 years ago

Estonia's Versobank faces a similar fate to Latvia's ABLV bank March 26 with the announcement by the European Central Bank and the country's financial regulator that it will have its license withdrawn.

According to our colleagues at ERR News in Estonia, the decision "followed a recommendation of the Estonian Financial Supervision Authority according to which Versobank has committed serious breaches of legal requirements, in particular concerning the prevention of money laundering and combating the financing of terrorism."

"The Financial Supervision Authority ascertained during on-site inspections carried out in 2015-2017 that Versobank AS had breached anti-money laundering and combating the financing of terrorism legislation, and also requirements concerning provision of services in other member states of the European Union. The breaches were systemic and long-lasting, and the bank did not fully eliminate them even after the intervention of [the regulator]," the regulator said in a press release.

Though it did not have a physical presence in Latvia, Versobank was also offering services to Latvians.

As previously reported by LSM, the Latvian regulator the Financial and Capital Markets Commission (FKTK) tried to ban Versobank from operating in Latvia in 2016, but then withdrew its objections in July 2017.

Versobank has 5,600 clients, of whom only 2,000 are residents of Estonia. Like ABLV it is oriented towards non-resident customers.

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