Licence of UAB “epayblock” revoked due to gross breaches of anti-money laundering requirements

The Bank of Lithuania received complaints and other supervisory information about a part of UAB “epayblock” customers potentially using its services for fraud. In response to that, in July, the Bank of Lithuania initiated the investigation of this electronic money institution’s activities. Before starting the investigation, the Bank of Lithuania obtained a court permission to apply to the institution temporary restrictions on the provision of services to its customers – legal entities.

The investigation revealed significant systemic breaches. The institution failed to identify and negligently assessed money laundering and terrorist financing risks of its customers. The customer identification procedure did not comply with legislative requirements, while higher-risk customers were not subject to mandatory additional enhanced due diligence measures. The institution failed to take sufficient measures to identify the objective and nature of business relationships as well as ascertain the true activities of its customers and did not verify such information using reliable and independent sources. The institution did not perform the monitoring of customer transactions. Internal control procedures were inadequate and failed to ensure independence of the compliance function from business interests, whereas the institution’s employees responsible for the prevention of money laundering and terrorist financing did not have necessary qualification and were not properly prepared for this work.

Having assessed the severity and duration of the breaches as well as other circumstances, the Bank of Lithuania revoked the licence of UAB “epayblock”, which means that the institution is no longer entitled to provide any financial services. It must return the funds to its customers to personal accounts with banks or other credit, payment or electronic money institutions indicated by them within the time limits specified in legal acts. 

Supervision of financial market participants, Payment institutions , Electronic money institutions , UAB "epayblock", AML