The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has submitted a notice to the Federal Register withdrawing its finding that ABLV Bank, AS (ABLV) is a financial institution of primary money laundering concern, as well as the related notice of proposed rulemaking (NPRM) seeking to impose special measure five pursuant to section 311 of the USA PATRIOT Act (section 311).
On February 16, 2018, FinCEN issued an NPRM that set forth FinCEN’s findings of money laundering concern regarding ABLV, a commercial bank located in Riga, Latvia, and proposed imposing special measure five under section 311, prohibiting covered financial institutions from opening or maintaining in the United States correspondent accounts for, or on behalf of, ABLV.
As described in the Notice of Withdrawal, material subsequent developments since the issuance of the NPRM have mitigated the money laundering risks associated with ABLV. Shortly after the issuance of the NPRM, the European Central Bank (ECB) determined that ABLV—as well as its subsidiary, ABLV Bank Luxembourg—was failing or likely to fail. The ECB subsequently withdrew ABLV’s banking license, and the Luxembourg subsidiary was ordered dissolved. Thus, ABLV no longer operates as a depository institution. The bank is in the advanced stage of an irrevocable liquidation process supervised by the Government of Latvia, which ensures anti-money laundering/countering terrorist financing (AML/CFT) compliance. Furthermore, Latvian authorities have undertaken significant efforts to identify and address past illicit activity facilitated by the bank, resulting in criminal charges against owners of the bank and its senior managers. As a result, FinCEN has determined that ABLV is no longer a financial institution of primary money laundering concern.
In parallel with targeted efforts relating to ABLV, FinCEN recognizes the notable progress made by the Government of Latvia to substantially strengthen its AML/CFT regime through a series of meaningful legal and regulatory reforms of its financial sector. These reforms have resulted in strengthened authorities, institutional capacity, and substantially reduced non-resident deposit activity in Latvia, a principal source of FinCEN’s money laundering concern at the time the NPRM was issued.
The text of the withdrawal can be found here https://www/fincen.gov/resources/statutes-regulations/federal-register-notices/withdrawal-finding-and-notice-proposed-1.
For questions, please contact the FinCEN Resource Center at 1-800-767-2825 or electronically at frc@fincen.gov.