The Bank of Lithuania defined minor infringement of the AML law

The Bank of Lithuania has defined the criteria for minor infringements of the law. The insignificance of an infringement will be decided by determining what requirements of the legislation were breached, the extent of the deviation, the extent of the infringement, the duration of the infringement and its duration, the consequences of the infringement and whether the act was committed solely as a result of a technical or human error.

According to new regulation, there are five main features which are considered as features of the minor infringement:

1. Non-essential requirements of legal acts have been violated and / or deviated from the requirements very little. Non-compliance with the requirements of legal acts shall be deemed to be non-compliance with them which does not jeopardize the business continuity of the supervised financial market participant, consumers or other essential interests of customers, other public interests or the Bank of Lithuania the ability to effectively supervise financial markets and cash-handling activities function.

2. Low level of infringement. The Bank of Lithuania, assessing the feature of the insignificance will take into account, inter alia, number of persons affected by the infringement.

3. The breach of the law is one time breach and / or of very short duration. Assessment the bank of Lithuania of whether the breach of the legislation has this insignificant characteristic may differ depending on the specific breach of the law.

4. The violation of the law did not cause any negative consequences, or they are insignificant. In assessing this insignificance feature, the Bank of Lithuania will consider, among other things, not only the material consequences of the breach, but also the consequences of the breach which could have arisen.

5. The violation of the law was committed due to technical or human reason mistakes. The Bank of Lithuania, when assessing whether a violation of the legal act has a feature of minor infringement will consider the nature of the technical or human mistake. The Bank of Lithuania will not consider mistake done by person due to a technical or human mistake ignorance of the provisions or misinterpretation of their content.

Additionally, it shall be mentioned that the list is not numerus clausus, the Regulator has a right to assess other circumstances as well.

If the infringement is be declared as having at least one of the features, the breach is stated as minor. This means that the sanctions are not usually applied, but other (supervisory) measures are applied as it is regulated under other legal acts. Additionally, the Bank of Lithuania dies not initiate an inspection in respect of complaints or notifications with regards of violation of the legal act. Nevertheless, such breach must be eliminated within 5 business days.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances

Prepared by attorney at law Loreta Andziulytė and assistant attorney at law Karina Zenkevičiūtė