Banks, EU – Baltic States, Financial Services, Latvia, Legislation

In accordance with the new legislation, the maximum fine for such violations will be equal to 10% of the bank’s total annual turnover, and not 10% of its net revenue in the previous fiscal year like it was before. If the 10% of the bank’s annual turnover is less than EUR 5 million, the Financial and Capital Market Commission (FCMC) will have the authority to impose a fine of up to EUR 5 million.

The regulator will be able to impose a fine of up to EUR 5 million also on bank managers or employees in charge of the prevention of money laundering if these persons fail to take the necessary measures to avert such crimes.

The FCMC will apply the penalties for activities that have resulted in violations of laws regulating the prevention of money laundering and terrorist financing regarding client identification and vetting, reporting suspicious and unusual transactions, providing information to the anti-money laundering service, refraining from a transaction, freezing of assets, creation of an internal control system, as well as the storage and deletion of information.

The penalties will also be slapped on banks violating requirements regarding international or national sanctions.