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FinCEN still has not approved Latvian ABLV Bank’s liquidation model

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U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) distances from Latvian Finance and Capital Market Commission’s (FCMC) statement regarding the coordinated liquidation model for ABLV Bank, as noted by the US Embassy in Latvia.

FCMC had previously reported that after meeting with representatives from FinCEN the committee sees no obstacles for the execution of FCMC’s approved ABLV Bank’s liquidation model.

FCMC chairman Pēters Putniņš says during the meeting with FinCEN experts had discussed the next stage in detail, specifically the methodology to be used during the creditors’ inspection process. «We are confident there are no obstacles left on the road towards ABLV Bank’s self-liquidation process, when has been coordinated with FCMC. We received no objections from colleagues, and talks were very constructive overall. The discussions process was necessary to make it clear to all involved institutions that Latvia is well-prepared for ABLV Bank creditors’ finances check and commencement of the costs stage,» says Putniņš.

However, the US Embassy in Latvia decided to clarify FCMC announcement to the press. «Press reports and statements from the regulator suggesting that FinCEN “approved” the methodology are inaccurate. FinCEN did not negotiate the methodology with FKTK and did not approve the methodology,» the embassy explained.

FinCEN notes that its public statements regarding ABLV Bank’s self-liquidation process are limited to the following agreed upon press statement: «On May 7, 2019 Latvia’s AML regulator, the Financial Capital and Markets Commission and the U.S. Treasury Department’s Financial Crimes Enforcement Network held a productive meeting to discuss the status of ABLV Bank’s liquidation. FinCEN found the Latvia-based ABLV Bank to be a primary money laundering concern, pursuant to Section 311 of the USA Patriot Act, on 13 February, 2018,» the US Embassy stresses.

As it is known, European Central Bank revoked ABLV Bank’s license in July 2018.

To ensure maximum protection of clients’ and creditors’ interests, and considering the decision by ECB on allowing commencement of the liquidation process, ABLV Bank’s shareholders decided at a meeting on 26 February to commence self-liquidation.

Problems for ABLV Bank started when US Department of Treasury Financial Crimes Enforcement Network announced in February 2018 its plans to establish sanctions against ABLV Bank for money laundering schemes that had assisted with North Korea’s nuclear arms programme, as well as illegal activities in Azerbaijan, Russia and Ukraine.


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