Latvia's Financial and Capital Market Commission fined Skandinaviska Enskilda Banken AB unit AS SEB banka a total of approximately €1.8 million after concluding a review — initiated in 2017 — into the regulatory requirements of its anti-money laundering systems and breaches of international sanctions.
Of the total penalty, SEB's Latvian subsidiary will pay an administrative fee of €672,684 after the regulator identified shortcomings in the bank's internal control systems for the prevention of money laundering and terrorism financing. The FCMC noted that on certain limited occasions there was insufficient documentation ensuring and proving the economic activity and beneficial owner of the bank's client.
The authority said the unit has developed its own plan to improve the identified deficiencies in the anti-money laundering systems, with most of the improvements already implemented.
In terms of the other violation, the FCMC fined SEB banka about €1.1 million after the bank detected and reported a single case in relation to the European sanction list.
The bank said it did not enter the correct information regarding the direct owner of one client, which was a subsidiary of a company added to the EU sanctions list after it became a customer of the lender. The connection was only spotted after the bank had carried out the payments related to tax, phone bills and purchases of accounting and directory services.
SEB banka added it terminated the customer relationship and reported the incident to the FCMC as soon as it identified the mistake.