Financial and Capital Market Commission (FCMC), Latvia’s financial market supervisory quthority fined BlueOrange Bank 1.2 million euros for violating anti-money laundering and terrorism financing rules. BlueOrange Bank, the country’s eighth largest bank by assets, will pay the fine but said it did have sufficient documentation on customers’ transactions.
The regulator said the rule breaches related to the bank’s operations in 2016 and 2017 when BlueOrange, which previously operated as Baltikums Bank, largely served non-resident clients mainly from former Soviet Union countries.
FCMC said the fine formed part of an administrative agreement on setting legal obligations under the scope of the Law on the Prevention of Money Laundering and Terrorism Financing in order to improve the functioning of the Bank’s internal control system. The watchdog said the bank did not the required attention to customer transactions and that it had failed to ensure that suspicious transactions were identified and reported to the Financial Intelligence Unit (FIU) of Latvia.
Latvia has come under intense scrutiny by EU and foreign regulators as being a conduit for illicit Russian funds. The country and its banking sector are eager to change that by strengthening AML regulation and its enforcement.