The decision to add the Baltic pair to the list was taken by the Ukrainian government at the end of 2017, ERR said, with 22 countries added to previous countries to make a total 85-strong list.
The law which came into effect January 1 lists countries with tax rates appreciably lower than Ukraine's and which might therefore be attractive for tax evasion schemes. Many of the names on the list are familiar tax havens such as the Cayman Islands and Panama which frequently appear in tax evasion and money-laundering schemes.
Latvia and Ukraine have been linked by a series of money-laundering scandals involving Latvian banks and complex offshoring schemes in various jurisdictions, often with Latvian nominee directors named as officials of offshore companies.
A recent expose by Al Jazeera outlined some such schemes.
In a separate move January 16, Ukraine's central bank released a report compiled by financial forensics firm Kroll which said the overseas branches of Ukraine's PrivatBank were used to perpetrate a fraud worth more than 5.5 billion dollars stolen from Ukraine. PrivatBank's "overseas units" were used "as a mechanism to service the related party companies," the report says.
The reputation of Latvian banks catering to overseas clients has taken a battering due to the extensive and massive nature of the various money-laundering schemes conducted over several years under the noses of regulators.
However, the Latvian financial regulator has in the last couple of years attempted to claw back credibility by imposing tougher penalties and giving more publicity to the failings it has traced.