Latvian Prime Minister Maris Kucinskis said the country intends to introduce tighter bank controls after one of its largest lenders, ABLV Bank AS, was closed down after being accused by U.S. authorities of money laundering and breaching sanctions on North Korea, Reuters reported March 8.
"Our ultimate goal is to eradicate any suspicious transactions. We do not want the banks who are just using Latvia or its vulnerabilities to make money," Kucinskis told the newswire.
He said the introduction of additional controls will mean "restructuring and capacity building," as well as an audit of the entire system. He added that the government recently discussed imposing a levy on financial transactions by shell companies, through which clients from Russia and former Soviet states conduct their dealings with Latvian banks.
Echoing the words of the head of Latvian Financial and Capital Market Commission, Peters Putnins, Kucinskis said the government's overhaul and additional controls could result in a fall in the number of local banks servicing foreign clients, adding that local authorities want to make sure that any reduction process is carried out in a controlled manner.
He also called again for Latvian central bank Governor Ilmars Rimsevics to resign over recent bribery allegations. Rimsevics, who denies any wrongdoing, has refused to quit and continued to be a member of the ECB Governing Council.
Rimsevics' lawyer reportedly told Reuters that they want to challenge restrictions imposed by Latvian investigators on his freedom to work, with plans to take the case to the European Court of Justice. ECB President Mario Draghi said March 8 that he has asked the ECJ for clarity on whether restrictions applied to Rimsevics effectively amount to his removal from office.
