Latvia's anti- money laundering chief rejected by Saeima

In a significant move June 16, the Saeima rejected handing Latvia's top anti- money laundering official a second term of office – despite her winning an open competition for her job and receiving the backing of the cabinet.

Ilze Znotiņa has played a key role in concerted efforts to turn around Latvia's previous reputation as a haven for money laundering in recent years, and in 2020 even received an award in recognition of her efforts in that regard after Latvia managed to avoid being placed on a list of countries with major money-laundering problems.

She is Latvia's representative to the crucial MoneyVal organization and has been featured in international media trumpeting recent reforms.

However, all that failed to impress a sufficient number of Saeima deputies, including significant numbers (but not all) from coalition parties the National Alliance and the Conservatives in addition to the opposition Harmony and ZZS parties, plus a sprinkling of independents.

During the debate, various negative opinions were expressed about her performance, including some accusations that her enforcement of anti- money laundering and terrorist financing rules was too strict.

In the end 33 deputies voted for Znotina's candidacy but 41 opposed it. Four more Members abstained and three did not vote (the Latvian system draws a distinction between the two).

As previously reported by LSM, Znotina recently won government backing to continue in her role. The main task of the Financial Intelligence Unit of Latvia is to collect and analyse financial data and reports of suspicious transactions, in order to hand this information over to Latvian law enforcement authorities to investigate cases of money laundering and terrorism and proliferation financing. 

The activities of the Financial Intelligence Unit of Latvia are regulated by the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing, as well as other national laws and regulations, EU regulations and international standards.

The net result of the vote is that the competition for the vacancy at the Financial Intelligence Unit will have to be run again, and in the meantime a stop-gap will be named. Meanwhile international observers are likely to be looking at Latvia very carefully in case there is evidence of backsliding on recent reforms.

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