RIB has improved its internal control systems

On 12.12.2023, Latvijas Banka has concluded an administrative agreement with AS “Reģionālā investīciju banka” specifying that AS “Reģionālā investīciju banka” shall fulfil legal obligations related to compliance with the requirements laid down in the laws and regulations governing the prevention of money laundering and terrorism and proliferation financing (ML/TPF) and to the improvement of the internal control system. 

At the same time, the credit institution has been subject to a fine of 259 867 euro for the identified violations of laws and regulations and shortcomings in the internal control system.

In 2022, the Financial and Capital Market Commission conducted an inspection, identifying certain shortcomings in the operation of the internal control system and violations of the laws and regulations governing the prevention of ML/TPF related to insufficient due diligence of high-risk customers from high-risk jurisdictions and transaction monitoring. AS “Reģionālā investīciju banka” acknowledges the identified violations and shortcomings and has promptly implemented measures for their elimination which serve as a basis for the conclusion of the administrative agreement. The administrative agreement establishes the legal obligations of AS “Reģionālā investīciju banka” aimed at strengthening the credit institution's internal control system and ensuring operational compliance with the requirements laid down in the laws and regulations governing the ML/TPF prevention, particularly in relation to the improvement of due diligence of high-risk customers and the process of transaction monitoring. The fulfilment of the legal obligations was supervised by Latvijas Banka and fully completed by the end of 2023.

Latest External audit were held by independent “big 4” auditor – Ernst & Young Baltic LLC company.  Assessment of AML/CTPF, EU Compliance program of the Bank has been concluded in March 2024. 

Ernst & Young Baltic conducted the assessment of the Bank’s AML/CTPF and EU compliance program in accordance with the procedures provided for in the regulations of the Bank of Latvia, including by examining how the Bank has implemented measures to address the deficiencies identified in the Bank of Latvia’s inspection. For more information, see the auditor’s report on the Bank’s annual report HERE. 

As a result of the assessment, the audit gained assurance that the Bank overall has an effective AML/CTPF and Sanctions risks management Internal control system and no high risk observations were found.

Latest Internal audit was done in December 2023. The performance and effectiveness of elements in the AML&CTPF field are assessed as "good" and the identified observations do not significantly affect the effectiveness of managing the overall AML&CTPF area and do not endanger future operations. Subsequently, in 2024, a follow-up was carried out, the aim of which was to assess whether the previously identified observations had been addressed and the recommendations implemented in practice, as well as to assess their impact on the overall effectiveness of the ICS.

Above mentioned 2 inspections results confirms that there has not been identified strategic deficiencies in the AS “Reģionālā investīciju banka” AML/CTPF internal control system, no high risk observations were found.