Major international workshop aims to strengthen the Lithuanian financial sector’s capacity to fight economic crime through collaboration
On 15th September 2022, the Center of Excellence in Anti-Money Laundering in Lithuania, together with the UK Royal United Services Institute (RUSI), convened a high-level international workshop to explore how to enhance the detection of economic crime in Lithuania through private-sector collaboration.
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Vice Minister of Finance of the Republic of Lithuania, Vaida Česnulevičiūtė, opened the event which brought together policy-makers and supervisors, together with senior financial intelligence and compliance leaders from financial institutions and other regulated entities in Lithuania. Europol, RUSI, Chainalysis, and Salv supported the discussion with information on international experiences.
The event, entitled, ‘Developing private-sector collaboration capabilities to tackle economic crime threats in Lithuania’, raised the following key themes:
- That Lithuania needs a national public-private strategy for collaboration and information-sharing to tackle economic crime.
- That the legal framework to support information-sharing in Lithuania needs to be strengthened.
- That Lithuania can continue to drive innovation as the Fintech Hub of the EU by ensuring that innovation and technology for collaboration are supported in Lithuania.
Vice Minister of Finance of the Republic of Lithuania, Vaida Česnulevičiūtė, emphasized: “Right now, more than ever, it is important to increase the resilience of the financial sector to potential threats. Although Lithuania is one of the least risky countries according to the Basel Anti-Money Laundering (AML) Index, we aim to become regional leaders capable of effectively and innovatively countering various threats and ensuring a sustainable contribution of the financial sector to economic growth. Risk management of the financial sector is one of the policies provided in the Government’s programme; therefore, our goal is to help financial market participants to properly assess and manage them”.
The Vice-Minister noted that there are around 20 anti-money laundering centres based on public-private partnership in the world, but the Lithuanian model is unique, it is not limited to the initiatives of individual institutions and market participants, but on the contrary, it raises the issues of combating money laundering to the national level.
Eimantas Vytuvis, Director, Center of Excellence in Anti-Money Laundering in Lithuania, highlighted: “Financial crime risk management is a global challenge. The only way we can efficiently combat financial crime is by strengthening cooperation between the public-private, private-private sectors and improving the information-sharing framework, as it raises many complex questions.
According to our latest research, financial institutions see the urgent need for adopting innovative technology solutions that will enable both private and public sectors to ensure the effective functioning of the AML/CTF system. However, creating a solid base for effective collaboration is fundamental. We must prioritize the integration of collaboration and information-sharing framework into our National AML/CTF Strategy. Only by taking this step, we will be able to build a solid foundation for future information-sharing framework.”
Nick Maxwell, Head of the RUSI Future of Financial Intelligence Sharing (FFIS) programme, commented: “Our study indicates that the old system of relying on financial institutions and fintechs to identify crime in silos is no longer fit for purpose. Since 2020, there has been significant innovation since in different forms of private-sector collaboration and the results are very promising. Lithuania is now exploring how to enhance its effectiveness in this regard and meet new recommendations on private-sector collaboration recently published by the Financial Action Taskforce (FATF).”
Taavi Tamkivi, the CEO of a regtech company Salv noted: “As financial crime becomes more complex financial institutions also need better solutions – especially ones that harness collective intelligence. It’s great to see the strong appetite for private-private information sharing in Lithuania, with both private and public sector stakeholders working to enable collaborative crime-fighting. From what we’ve seen working with other countries strong support and encouragement from regulators is crucial in empowering banks to implement new innovative solutions.”
Janet Ho, Head of EU Policy at Chainalysis, a blockchain analytics data platform remarked, “Financial crime does not stop at one company, one industry, or even one country. Public-private partnership is key to disrupting emerging financial crime using new technologies. Blockchain analytics enable both sectors in detecting illicit finance relating to crypto finance while achieving a balance between transparency and privacy.”
More than 3,500 Lithuanian financial market participants have already participated in the Center’s training.
2 trillion EUR
It is estimated that around EUR 2 trillion is laundered by financial fraudsters worldwide every year.
Average score by which participants assess the quality of training.