Another form of money laundering has erupted in Europe. The Baltic region had previously experienced dirty-cash scandals involving hundreds of billions, and yet, a new financial crime has surfaced with a focus on payment service providers. The criminals help people send money around the world at low-cost and use the medium to engage illegal transactions.
This was discovered earlier this year when officials from the Nordic countries suspected that about $230 billion that entered a small branch in Estonia could be illegal. This and the presence of global players who have European license from other country has triggered the actions of the law enforcement. Three employees of Good Finance Company, a financial institution controlling half of the country market were detained and the company license was withdrawn on charges of money laundering and embezzlement. AS Talveaed also had its license withdrawn in April. The companies were accused of violating legal obligations. These actions have helped reduce the risk of money-laundering significantly.
Latvia is also at high risk of tax-fraud schemes due to the vulnerability of the sector to the management of AML systems, according to the report. According to Ilze Znotina, head of Latvia’s Financial Intelligence Unit, electronic money institutions and payment companies are in big danger.
