The Bank of Lithuania (BoL) fined the e-money institution Wallter UAB (www.wallter.com) €280,000 for violating the Lithuania Law on the Prevention of Money Laundering and Terrorist Financing. Moreover, the regulator imposed additional obligations on Wallter. The institution, regulated by BoW under the authorization code LB000450 has to eliminate all violations and shortcomings until 31 March 2022. Many of Lithuania’s EMIs operate in the high-risk sector and are notorious for their very relaxed approach to money laundering and cybercrime.
The co-founder and CEO of the Wallter is the Italian Isaac T. Armoni (LinkedIn). He was previously the Head of Legal Department and Chief Compliance Officer at FCA-regulated MoneyNetInt Ltd until 2017. He is pictured left.
The Bank of Lithuania further revealed that the customer risk assessment procedures applied by Wallter had not ensured an adequate identification of money laundering and terrorist financing risks of its customers and an appropriate classification of the customers into risk groups. According to BoL, Wallter had not always adequately identified its customers and representatives. The institution’s KYC procedures were insufficient to understand the objective and nature of the activities of its legal entity customers.
Wallter UAB had not ensured the application of enhanced customer due diligence procedures for higher-risk customers and the regular updates of customer verification information. The institution did not have appropriate measures to collect sufficient knowledge about customer-specific behaviors, which would enable the proper identification of unusual transactions and operations.
Wallter UAB had not adequately assessed the documents provided by customers to prove the legitimacy of their payment operations, transactions, purpose, or the origin of funds. It only superficially analyzed complex transactions and failed to examine their background sufficiently. In addition, the institution had not ensured the independence of the internal control function, which is responsible for the organization of the prevention of money laundering and terrorist financing from business interests.
BoL obligated Wallter UAB to eliminate all violations and shortcomings identified by 31 March 2022. The institution has already taken action on its own initiative to ensure the elimination of these deficiencies and their prevention in the future.
