The regulator has even published a schedule of which financial institutions it will be visiting, when, and what it will be looking for, so the exciting prospect of inspectors swinging in through the windows on ropes to demand a look at the books is a distant one.
Santa Purgaile, Chairwoman of the FKTK said: "Despite of Covid-19 control measures, the FKTK has fully succeeded to conduct inspections as planned for 2021, ensuring comprehensive, effective and risk-based supervision of financial institutions. The year 2022 inspection plan is far-reaching and ambitious. It will pay particular attention to the new entrants in the financial sector, while inspections of existing market participants will be targeted, focusing on the problem aspects identified when executing off-site supervision tasks."
The 2022 plan reflects upcoming on-site inspections; however, the plan may be modified according to the risk assessment updated in line with day-to-day supervisory activities, the regulator added. In addition to the planned inspections, the FKTK ensures daily monitoring, as well as in response to complaints or other information available to the FKTK, which raises suspicion of non-compliance with regulatory requirements, the FCMC conducts ad hoc inspections or applies other supervisory measures... so the rope-swinging scenario isn't entirely off the table.
"In 2022, the FCMC intends to perform 12 inspections in the field of anti-money laundering and counter terrorism and proliferation financing (AML/CTPF) and sanctions," the regulator statement said.
This year 14 inspections are planned in banks, two in the insurance sector, two in the pension sector, two in the field of investment, two in central securities depository, three in payment institutions, one in an electronic money institution, 12 in investment firms, and five in savings and loan associations.
The regulator also noted it would pay attention to reinforcing sanctions against Belarus and countering online fraud and cybercrime.
"In 2021, during on-site inspections various shortcomings were identified, such as deficiencies in the field of credit risk management, crowdfunding processes, in the AML and sanctions field, internal management and risk management," the FKTK said.
The plan of inspections is available on the FKTK website at: https://www.fktk.lv/wp-