Big increase in number of Latvian money laundering cases in 2019

In 2019 the number of criminal cases handed in to the courts involving money laundering increased significantly, along with the number of defendants, according to the Prosecution Office on February 27.

59 criminal cases involving 102 persons charged under Section 195 of The Criminal Law on the “Laundering of the Proceeds from Crime” were brought to court last year. For comparison, in 2018 there were only 23 similar criminal cases involving 54 persons. From 2017 to 2019 the Prosecution Office brought a total of 103 criminal cases against 195 persons in regards to money laundering.

Rather than assuming this drastic increase in cases is the result of higher crime rates, it could instead be explained by additional training about money laundering. Over the past few years the Prosecution Office has increasingly participated in training on combating, identifying and confiscating illegally laundered money. In 2017 30 prosecutors participated in such training, but in 2018 the number jumped to 193, and in 2019 almost 330 prosecutors participated in such training.

In accordance with a 2018 prosecutor training plan approved by the Cabinet of Ministers in 2018, special attention has been paid to implementing new legal regulations, as well as gathering evidence on money laundering. In 2018 only 30 prosecutors participated in this special training, but in 2019 more than 200 prosecutors from various prosecutorial units participated.

In addition, in 2019 the Prosecutor General organized training on combating money laundering and confiscation through organized investigations for the State Police, Corruption Prevention and Combating Bureau (KNAB) and the Military Police.

In February 2019 Prime Minister Krišjānis Kariņš announced that he was giving officials just over one month to draw up "substantial" reforms to the anti- money laundering system operating in Latvia. Following a meeting of the Financial Sector Development Council, Kariņš announced the decision to implement "a substantial financial sector control reform" ordered the Ministers for Finance, Justice and the Interior to draw up a legislative package to be put to the Cabinet of Ministers.

As previously reported, in 2019 Latvia submitted a progress report to the Financial Action Task Force (FATF) on its efforts to crack down on money laundering, and related financial crimes. The report centered on the implementation of recommendations made by Moneyval experts to improve the existing system of anti-money laundering measures and the combating of terrorism and proliferation financing (AML/CTF/CPF).

The year-long crackdown on Latvian banks' reputation for money laundering and sanctions dodging appeared to have paid dividends on January 22 with official recognition of its success from the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism - MONEYVAL.

That was backed up last week by a decision of the Financia Action Task Force.

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