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Strategy and policy
Reform Support

Strengthening Risk-Based AML/CFT Supervision in Lithuania

Supporting reforms to develop well-regulated, stable and competitive financial markets

Funding Programme
Year
  • 2022

Strengthening Risk-Based AML/CFT Supervision in Lithuania

The commission helped support the reform of Lithuania's anti-money laundering and combatting the financing of terrorism (AML/CFT) regime through a 27-month project (June 2022 – September 2024).

Context

The European Union has constantly improved its regulatory framework to fight money laundering and terrorist financing and to align it with the recommendations from the Financial Action Task Force (FATF), the international standard setting body on anti-money laundering and countering the financing of terrorism. The Directive on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (AMLD) has been amended four times, notably extending the scope of crimes, professions and activities covered. In addition, the European Commission has proposed in July 2021 an ambitious legislative package with three objectives: 

  1. to strengthen EU anti-money-laundering rules and enhance their clarity while ensuring consistency with international standards and other EU legislation; 
  2. to improve the effectiveness and consistency of anti-money-laundering supervision;
  3. to increase the level of cooperation and exchange of information among Financial Intelligence Units (FIUs).

Support delivered

Over the course of the project, specific activities implemented by the Council of Europe include: the development of ML/TF Sectoral Risk Assessment Methodology for relevant higher-risk sectors of Obliged Entities identified by the recent National ML/TF Risk Assessment; the review of the existing framework and tools for exchanging information between the AML-CFT Supervisory Unit (AML-CFTSU) of the FCIS with other AML/CFT and prudential supervisors; the provision of guidance to authorities in conducting Sectoral Risk Assessments of Virtual Assets (VA) and Virtual Asset Service Providers (VASPs) pursuant to the Methodology developed by the Council of Europe; the development of the AML/CFT Risk-Based Supervision Manual for the AML-CFTSU, and the development of training materials and provision of trainings on the risk-based supervision for the AML-CFTSU staff. 

Results achieved

The expected long-term effect of this project is an enhanced AML/CFT regime in Lithuania, through strengthening the FCIS’ risk-based supervision and its consequent supervisory approach to the sectors within its remit.