Financial Crime World

Here is the article in markdown format:

Compliance with OFAC Sanctions: Guidelines for Financial Institutions in Latvia

===========================================================

Purpose

The purpose of these guidelines is to outline the requirements for financial institutions in Latvia to comply with Office of Foreign Assets Control (OFAC) sanctions. The goal is to develop a safe and stable financial system in Latvia.

Key Objectives

  • Improve internal control systems to ensure compliance with international, national, and extraterritorial sanctions regimes.
  • Prevent transactions that may be prohibited by OFAC sanctions.
  • Develop sufficient and adequate internal controls for compliance with OFAC sanctions.

Key Principles

  1. Know Your Client
    • Financial institutions must implement this principle to prevent transactions that may be prohibited by OFAC sanctions.
  2. Comply or Explain
    • If a financial institution cannot comply with an OFAC sanction, it must explain the specific circumstances and reasons for non-compliance.
  3. Internal Controls
    • Financial institutions must ensure their internal control systems are sufficient and adequate for compliance with OFAC sanctions.

OFAC Sanctions

The guidelines mention that OFAC sanctions cover various categories, including:

  • Designated countries
  • Designated entities operating in the interests of designated countries
  • Individuals and organizations identified as involved in international crime

Compliance Requirements

  1. Prohibited Transactions
    • Financial institutions must preclude execution of transactions contravening OFAC prohibitions.
  2. USD and Other Currencies
    • Compliance with OFAC sanctions applies to both USD and other currencies.
  3. Investments
    • Financial institutions must invest in necessary measures to eliminate obstacles hindering compliance with OFAC sanctions.

Training and Awareness

The Association will conduct regular trainings for employees on implementing OFAC sanctions, as well as organize events to inform the public about financial institutions’ duties under the guidelines.

If you have any further questions or concerns about these guidelines, please don’t hesitate to reach out.