The Bank of Lithuania (BoL) has issued a comprehensive analysis of money laundering and terrorist financing (ML/TF) risks faced by electronic money and payment institutions (EMIs) from January to December 2023. This report highlights key vulnerabilities in the financial sector and emphasises the urgent need for EMIs to enhance their anti-money laundering (AML) frameworks, fraud prevention strategies, and internal controls.
Key Findings and Recommendations
The BoL identified several areas requiring immediate attention to mitigate ML/TF and fraud risks:
1. Sanctions Compliance and Monitoring
Financial institutions must continuously review and test transaction monitoring rules to ensure alignment with international sanctions and restrictive measures.
2. Enhanced Internal Controls for ML/TF Risks
Strengthening internal systems is essential to managing emerging threats effectively.
3. Fraud Prevention Measures
Investment scams remain the most significant fraud risk. EMIs are urged to implement robust customer screening processes to identify links to fictitious or unlicensed platforms.
4. Conflict of Interest Management
Institutions must clearly separate roles to prevent conflicts of interest and ensure employees do not hold overlapping duties that could lead to regulatory or operational risks.
5. Ongoing Staff Training Programs
Regular training incorporating the latest ML/TF typologies is vital to maintaining awareness of evolving threats.
6. Improved Information-Sharing Mechanisms
Strengthening internal communication ensures management and staff remain fully informed of current ML/TF risks and regulatory expectations.
This guidance reflects the Bank of Lithuania’s commitment to safeguarding the financial sector against financial crime by encouraging proactive risk management, regular staff training, and a well-coordinated internal control framework.
ECOVIS ProventusLaw Can Help
The increasing regulatory scrutiny emphasises the need for EMIs to adopt a proactive approach to AML compliance. At ECOVIS ProventusLaw, our AML experts provide specialised services to help financial institutions align with the Bank of Lithuania’s recommendations and reduce exposure to ML/TF and fraud risks.
- Tailored Compliance Solutions: We assist in designing and implementing internal control systems that are tailored to your organisation’s specific needs.
- Customized AML Training. We help your team keep informed with our tailored training programs focused on the latest ML/TF trends and regulatory updates.
- Perform Gap Analysis: We help identify deficiencies, weak areas in AML/CTF program and to prepare for BoL inspections.
- AML/CTF internal/external audits: We help to assess whether the ML/TF prevention control measures are working effectively and whether the relevant documentation is in order.
With our expertise, your institution can meet regulatory expectations and strengthen its defences against financial crime. For guidance on implementing these measures, contact our team today.
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