ESTONIA’s Financial Supervision Authority (FSA) has fined LHV Pank €900,000 for AML/CFT shortcomings, the watchdog announced today (Tuesday).
The FSA said that LHV fell short in the fields of establishing business relations and their monitoring, as well as its obligation to store data.
The watchdog has also issued an order, obligating the Estonian bank to improve its AML/CFT risk control systems.
Kilvar Kessler, head of the authority, suggested that it was LHV’s rapid growth coupled with a high-risk environment that led to deficiencies and violations at the bank.
“Rapidly developing payments intermediaries could experience a situation where their risk management side fails to keep up with growth. That is when FSA supervision can remind banks that risk management requires attention and investment,” said Kessler pictured.
He added that the bank is being co-operative “and is taking measures to rectify the deficiencies. We will be monitoring the process closely.”
In a statement today the authority said it had “carried out an on-the-spot check at AS LHV Pank to determine whether its anti-money laundering and counter-terrorism funding systems and internal rules when offering other financial institutions services were in accordance with the law.”
“The FSA also analyzed whether the bank’s AML and counter-terrorism funding systems and rules are enough to manage additional risks created in correspondent banking. Shortcomings were found in AS LHV Pank’s AML/CFT controls and business relations monitoring,” the statement added.
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