On February 13, the Financial Crimes Network of the US Treasury Department (FinCEN) accused ABLV Bank, which is the third largest bank in Latvia and supervised by the European Central Bank, in not thoroughly applying the Know Your Customer procedure, resulting in carrying out operations related to the North Korean weapons program and corruption schemes in Russia and Ukraine. In this regard, other banks, including card payment systems, refused to make payments both through the bank and the bank itself. In other words, the bank’s activities were suspended.
February 19 in order to stabilize the situation European Commission for the Supervision of the Financial and Capital Market (hereinafter – FCMC) decided to introduce payment restrictions on ABLV Bank customer debit operations.
On February 24, ABLV Bank received the decision of the Council of the FCMC to freeze deposits placed with the Bank. In making such decision, state guarantees each ABLV client a refund in the amount of up to 100,000 euros. The implementation of guaranteed refunds should begin within not more than eight working days from the time of the freezing the deposits (that is, not later than March 7, 2018).
So far, there is no information about the Bank’s future, but based on the current situation, it is expected that the liquidation process may be initiated. Bank promises that details of what awaits customers, employees and shareholders of the Bank, will be known today.
At the moment, customers do not have access to their funds either in the branches or through the Internet bank. The Bank’s card system is turned off, which means that customers can not pay by bank cards and withdraw cash from ATMs.
BBP Baltic will be following the latest updates and try to help ABLV Bank clients to find new solutions.