The Board of the Financial and Capital Market Commission (FCMC) has decided to impose a fine of EUR 105 000 on AS Expobank (Bank) for deficiencies identified in customer due diligence and their transaction monitoring. During inspections, FCMC found out that the Bank had failed to provide for the appropriate documenting of customer due diligence and transaction monitoring in accordance with regulatory requirements.
According to the Law on the Prevention of Laundering the Proceeds from Criminal Activity (Money Laundering) and of Terrorist Financing and the FCMC Regulations for Enhanced Customer Due Diligence before starting business relationship with the customer the Bank must perform enhanced customer due diligence, if there are any high risk characteristics, and the activities of a customer must be assessed on an ongoing basis to be fully aware of transactions performed, accompanied with documenting the process.
The amendments to the Credit Institution Law of May 2014 stipulate new fine application procedures for credit institutions according to which FCMC may impose a fine of up to 10 per cent of the net revenue of the previous financial year. In case of AS Expobank it would constitute up to EUR 837 876. In fixing the amount of the fine at EUR 105 000, FCMC has taken into account the nature of shortcomings identified, as well as the fact that the Bank had already eliminated part of deficiencies by the moment of imposition of penalty and it still continues to enhance its internal control system.
Since 2014, information on the sanctions applied by FCMC is to be disclosed publicly (here: http://bit.ly/1MIz6C6). The fine imposed on the Bank will be paid into the State budget.
Public Relations Specialist
Financial and Capital Market Commission
Phone +371 67774860, +371 27435292