Another Latvian bank fined over money-laundering failures

Take note – story published 7 years ago

Another Latvian bank on Monday joined a growing list of local financial institutions to be slapped with penalties for making it easy for fraudsters to launder vast amounts of cash into the European Union's banking system. 

Latvia's financial regulator, the Financial and Capital Markets Commission (FKTK) said it was fining Latvijas Pasta Banka (Latvian postal bank, LPB) €305,000 euros for failing to stop massive payments through its accounts in connection with a billion-euro fraud in Moldova. 

The name of the bank emerged in a leaked report on the 2012-2013 Moldovan fraud by independent financial investigators Kroll, carried out for the National Bank of Moldova.

FKTK said the amount of the fine was based on "the bank's financial performance as well as the fact that the bank has recognized inspection findings and committed to take the necessary measures to address them and improve the bank's internal control system." 

After years of denying Latvia was being used as a money-laundering gateway to Europe, particularly by Russian and othe former CIS countries, the last two years have seen FKTK take action against a number of banks for lax implementation of money-laundering rules, including so far (click for details):

Trasta Komercbanka


Baltic International Bank


Regional Investment Bank

In addition, Rietumu Bank faces action in the French courts over allegations it helped facilitate a major tax evasion scam, allegations which it denies.

A list of some of the penalties and their growing size and frequency can be read at FKTK's site HERE.

Earlier this month Latvijas Pasta Banka said it had signed up to a social charter of banks designed to "create a reliable, responsible and sustainable banking system in Latvia."

Latvijas Pasta Bank earned €4.4 million in profit last year, more than double its 2014 figure.

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