The Bank of Lithuania has fined fintech firm Contis (formerly Solaris) with €840,000 over allegations of AML breaches.
In a press release translated into English, the central bank accuses Contis of facilitating electronic money processing operations between 2021 and 2022 without enforcing adequate AML controls over customers.
“(The fintech) was performing its activities through distributors of electronic money, ensured functions related to the implementation of money laundering and terrorist financing prevention measures, but did not control that the distributors properly implemented these functions,” the press release said.
As a result, the bank concluded that Contis had exhibited “significant weaknesses” when it came to the verification and assessment of the fund distributors’ actions.
Further details found that Contis“did not comply with the requirements for the prevention of money laundering and terrorist financing, as well as information security and business continuity risk management”.
Furthermore, when suspicious activity did occur, the Bank of Lithuania said that Contis “did not take timely measures” to address the issue.
“The implemented scenarios were not enough to identify suspicious activities of the client in a timely manner, and not enough human resources were allocated to carry out monitoring,” the report noted.
“The Bank of Lithuania also found that the institution had not tested how business continuity plans would be implemented in practice. There is a warning for this.”
However, the bank also noted that Contis has “taken steps to eliminate the violations in question”, fully cooperating by devising a strategy to address the issues and is providing regular updates on its progress.
Contis has been given a deadline of 31 March to fix all highlighted violations and is expected to additionally submit an audit until 30 June.
A Solaris spokesperson added: “Solaris always strives to meet the highest standards of compliance. The Bank of Lithuania’s review covered a past period from 2021 to 2022. A core priority for Solaris this year has been undertaking work to successfully deliver remediation actions that were highlighted by this report.
“We are working closely with the regulator and have proactively implemented the majority of the measures to reflect recommendations given by the Bank of Lithuania.”