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“We warned a few years ago that the impact of Brexit, when fintech companies seek favorable conditions for relocations, will be felt in our public finance system. This will lead to a much higher risk of money laundering and terrorist financing, which will not be enough to manage alone, it requires a state approach and investment so that the increase in the country’s competitiveness does not come at the expense of the security of the country. financial system ”, says Antoni Mikulskis, Director of the Financial Crime Investigation Service.
Starting in the new year, the Lithuanian-licensed Revolut division will take care of the company’s customers from all over Europe, which means 10 million. new accounts through which huge cash flows will flow.
FNTT’s money laundering prevention experts predict that the risk of money laundering can increase significantly with new accounts, and the number of reports of suspicious transactions or money transactions can increase more than tenfold.
The money laundering prevention system can be predicted to overheat without increasing analytical capacity and investing in smart technologies.
The number of suspicious transaction reports is growing
“Lithuania’s resistance to the risks of money laundering and terrorist financing is regularly assessed by the Council of Europe Committee of Experts on the Evaluation of Measures against Money Laundering and the Financing of Terrorism (MONEYVAL).
This year, Lithuania’s rating was improved due to the National Risk Assessment, which showed that the country clearly understands potential risks and threats, identified the most vulnerable sectors and areas where the risk of money laundering and terrorist financing may be greater ”, says the FNTT’s Money Laundering Prevention Board. Chief Edmundas Jankūnas.
According to experts, MONEYVAL’s assessment better demonstrates the country’s readiness to combat money laundering and its contribution to improving the prevention of money laundering. According to the rating given, potential investors, foreign banks assess the country and investment environment, the involvement of all responsible domestic institutions in the prevention of potential risks.
A great deal of work has been done in Lithuania, demonstrating that Lithuania has long been a newcomer to the implementation of the prevention of money laundering and terrorist financing and is rapidly finding its way to full compliance with international standards.
However, unreasonable optimism in the competition to attract new entrants, ignoring the ever-growing investment in prevention, can bring these efforts and results to the bottom line if all responsible authorities forget to talk about reconciling ambition with options. prevention.
The image of Lithuania in the international context of the assessment of the prevention of money laundering is a matter for all responsible institutions and only a common approach, responsible assessment of opportunities and planning can attract long-term success.
According to the National Risk Assessment, the number of reports of suspicious monetary transactions or transactions increases every year. During customer follow-up, more reports on suspicious monetary operations or transactions of Lithuanian natural and legal persons have been reported in recent years, but there is a trend that in 2019 there has been a significant increase in the number of notifications from persons foreign physical and legal entities as main entities, as well as an increase in the number of notifications of electronic money and payment institutions. Fixed and cash transactions for an amount greater than 15 thousand. euro, an increase in the number in recent years. As of 2021, along with 10 million. With the advent of Revolut accounts, these numbers are expected to increase significantly.
Invest in smart solutions
The experts of the FNTT assure that when there is a real threat that the analysis of reports of suspicious monetary transactions or transactions could get stuck or be completely paralyzed, some time ago, thinking about improving processes through automation solutions.
Already today, the FNTT uses a platform that automatically, in accordance with the established criteria, collects the basic information required for the analysis of the notification of suspicious monetary transactions, assesses the level of risk and performs an administrative function. It is estimated that by automating processes, the system will take over about 30 percent. the work normally performed by officials. This is expected, at least in part, to speed up the process of analyzing reports of suspicious transactions or transactions and prevent overheating of the anti-money laundering system.
There is a growing focus on hugely popular virtual money. The use of virtual currencies and the activities of its exchange operators are increasingly active. As the analysis of financial data from recent years has shown, the total cryptocurrency turnover of clients of large commercial banks and other credit institutions operating in Lithuania amounted to more than 660 million. euros. Technology is becoming more accessible, easier to use and the market is adapting rapidly and can offer increasingly sophisticated tools.
To keep up, investments are also needed in this area, as the competence of employees and the receptivity of institutions to technology must constantly increase. One of the main investments of the FNTT has become a tool to monitor the movements of cryptocurrencies. All major cryptocurrencies are being tracked: Bitcoin, Ethereum, Ripple, Dash, and more.
The new tool allows you to trace the transactions that have taken place and possibly the original sender. This tool is used by financial supervisors in at least 18 EU member states, which will facilitate cooperation with supervisors in different countries and increase the efficiency of electronic investigations of financial crimes.
When assessing the scale of financial crime in Europe and the rapidly expanding technological capabilities used to commit financial crime, there is an indisputable need to strengthen financial intelligence. The objective of the FNTT is to comprehensively modernize the available information tools. The intention is to apply the latest information technologies: to use artificial intelligence to process very large data flows.
Funding for this project is expected to come from funding from the DNA Plan for the Future Economy. By modernizing existing financial intelligence tools, it will be possible to identify a greater number of financial discipline violations during the same period. This will speed up the initiation of criminal investigations and their transmission to the authorities for final decisions on damages to the state budget. The process of returning funds to the state budget will be accelerated.
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