Over 30 criminal cases started so far as ABLV bank folds

There are delays in returning the deposits of the clients of the folded ABLV bank, as the involved parties have not agreed upon the depth in which to probe account histories of potentially suspect clients, reported LTV's investigative show De Facto. Latvia's PM Krišjānis Kariņš has become involved, saying an agreement must be reached by February 20.

Discussions over checking suspicious deals and paying out former deposits from the bank, currently in the process of liquidation, are ongoing between Latvia's banking watchdog, the Financial and Capital Market Commission (FKTK), and the Control Service, Latvia's anti-money laundering institution. 

"We've discussed better solutions with FKTK," said Control Service head Ilze Znotiņa.

Meanwhile Pēteris Putniņš, the head of the FKTK, said that his institution has worked "very actively" to "meet the wishes and objections of Mrs. Znotiņa." Putniņš said that there are no problems with the current methodology. 

ABLV has agreed with FKTK to probe about 3,000 current depositors as well as their partners amounting to about 10 to 12 thousand. Meanwhile the Control Service is also interested in the accounts that have been emptied or are already closed. That would mean tens of thousands of accounts would have to be checked.

Bank representatives agree with Putniņš that inactive clients should not be checked during the bank's liquidation as the bank doesn't owe them anything. 

According to Putniņš, the Control Service is worried whether access to account histories would be ensured, but the bank had told him it plans to save the records.

Znotiņa meanwhile said that first of all she wants to discover whether current clients have not dealt with the bank earlier and whether they have ties to the empty accounts. Without this information, it might not be possible to prove or disprove the money laundering accusations against the bank, she argued.

"I am not sure exactly what the Control Service doesn't like, but I think that as self-liquidation is ongoing right now, working with the creditors is most important. If someone wants to check something else, I think the state should do that and it shouldn't be added to the self-liquidation process. And shareholders shouldn't be asked for their money to do that," said ABLV shareholder Ernests Bernis.

However Znotiņa said that, for example, Danske Bank's Estonian branch, which was accused of money laundering last year, will look into historical transfers as well.

"Sadly, we've not been able to reach the situation they have at Danske," said Znotiņa. The Control Service has, however, hired experts from the Kroll financial investigations company to check ABLV transfers.

ABLV liquidators have also voiced qualms with the directive by the previous government to coordinate the probe with international partners.

State institutions are likewise perplexed about the directive as the exact way of coordination is unclear. But PM Kariņš thinks that all will be smoothed out by Wednesday.

"I have my full confidence that our independent institutions will be able to come to an agreement and fulfill the requirements," said Kariņš. 

Meanwhile officials are not rushing ahead with forecasts as to how much dirty money will be discovered at ABLV. 

As of now, 35 criminal cases have been started with about €20m frozen. But the investigation is yet to kick into full gear. In total, there are 302 active investigations over similar financial crimes in Latvia. 

Bernis told De Facto that it's possible that there'll be cases of ABLV clients lying or not saying the entire truth, however he remains confident that there'll be no cases implicating the bank.  

As previously reported by LSM, Latvia's financial regulator, the Financial and Capital Market Commission (FKTK) announced on June 12, 2018 it had decided to allow ABLV bank to undergo a process of self-liquidation.

ABLV collapsed after being accused of institutionalized money laundering on a huge scale by U.S. financial authorities. The bank denied the allegations. It has been a swift fall from favor for what was Latvia's third-largest bank and largest domestically-owned bank.

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Economy
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