ABLV Bank Statement for the press

Riga, Latvia, February 15, 2018, 08:01 / Banking

Here is our opinion that was provided today on the press brief. We will continue to explain our position to the society and the clients given the unprecedented report released by the U.S. Department of the Treasury.

Here is the full speech:

ABLV Bank strongly denounces the use of financial institutions in illegal actions, including money laundering, terrorism financing and circumventing sanctions. The bank fully supports the efforts of the U.S. Department of the Treasury in combating such criminal activity.

ABLV Bank has already contacted officials at the U.S. Department of the Treasury in order to start negotiations and provide all and any necessary information at our disposal and to carry out all necessary corrections.

ABLV Bank points out that its internal control system in the field of the prevention of money laundering, terrorism financing and circumvention of sanctions, as well as the implemented control solutions have been audited and inspected both by the regulator and by international auditors. ABLV Bank follows a zero tolerance policy regarding those clients, whose transactions may be related to money laundering, terrorism financing or violating sanctions.

However, if someone has manipulated the bank systems to defeat the comprehensive controls in place and to elude audit, then the bank puts the highest priority on uncovering the illegal acts and reporting this to the appropriate law enforcement authorities. We firmly reject everyone who tries to use our bank for illicit purposes.

With full confidence, ABLV Bank considers the allegations presented in the Proposal by the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of the Treasury to be based on assumptions and information that is currently unavailable to the bank. However, we are continuing check into these allegations.

ABLV Bank considers the bribery mentioned in the Proposal absolutely unacceptable; the bank has immediately turned to law enforcement institutions asking for a review. Today, on 14 February, the bank has lodged a complaint with the State Police and Corruption Prevention and Combating Bureau requesting to check this information.

Neither the bank, nor the bank’s employees have ever conducted any act of bribery regarding any official. Such announcement, which accuses the bank’s management and its representatives in committing particularly serious offence, causes significant damage to the reputation of the bank.

We hereby confirm that we will provide all and any necessary information in order to foster a fair and quick investigation.

ABLV Bank emphasizes that it is open to repeated and new inspections of any competent authorities and is going to be proactive in conducting such inspections in order to mitigate any suspicions regarding the released information.

Also, we have always been and always will be open to cooperation with U.S. authorities and are ready to provide any necessary information and open unlimited access to the bank’s information for the officials of the U.S. Department of the Treasury, including conducting inspections.

In general, over the recent years, ABLV Bank has put forth tremendous effort in improving its internal control systems. Moreover, we are always ready for any recommendations that would strengthen the bank’s operation.

In addition, over the last two years, the bank has carried out several independent inspections in the field of preventing money laundering and terrorism financing inter alia closely cooperating with the U.S. consultants Navigant Consulting and K2 Intelligence, whose recommendations the bank has duly implemented. Also, in compliance matters, the bank is closely working with Financial Integrity Network (FIN) — its strategic consultant from the USA.

We would like to draw your attention to the information previously reflected in media:

Firstly, regarding North Korea that is also mentioned in the Proposal released in the USA, we would like to emphasize that regarding the North Korean case, the regulator had initiated an administrative matter, and in November 2017 a Settlement Agreement was concluded. After a six-month inspection, the following conclusion was provided: “There were no violations of international, including European Union, sanctions, national sanctions of the Republic of Latvia, as well as sanctions imposed by the USA, detected in the operation of the Bank”.

On 24 May 2017, the bank turned to the Security Police asking them to initiate a criminal case regarding the circumstances and allegations heard regarding the probable circumvention of the sanctions imposed against North Korea. We filed this request since neither the documents at the bank’s disposal, nor the results of the bank’s internal investigation, or public resources reveal any relation of any client of the bank with the North Korean company mentioned in the files of the case.

Secondly, speaking of the Moldova’s case that was mentioned in the Proposal and was widely covered in the press: on 15 August 2017, the bank turned to the State Police requesting they initiate a criminal case due to that the bank faced illicit actions of an organised crime group that has been continuously and purposefully deceiving the bank regarding the nature of the transactions carried out and the ownership of the funds. Under the said case, having analysed the situation, the bank agreed with the regulator to further strengthen the necessary control mechanisms, and invested almost EUR 10 million to further improve and strengthen these controls.

On the bank’s operation

ABLV Bank continues its operation, holding negotiations with all partners and financial institutions actively explaining our position. We hereby confirm that the financial condition of the bank and adequacy of financial resources are sufficient. These events should be regarded as force majeure circumstances, thus we can admit that a part of our services might be unavailable to our clients at this stage.

We would like to thank our clients for understanding our position regarding this difficult situation and appreciate their support.