3rd National Money Laundering and Terrorist Financing Risk Assessment: 2 business sectors among the riskiest
The latest 3rd National Money Laundering and Terrorist Financing Risk Assessment 2019-2022 (NRA) identifies the business sectors with an overall very high or high level of money laundering and terrorist financing risk.
The focus of supervisors should be on the 2 sectors that have received a very high money laundering (ML) risk assessment - Virtual Currency Exchanges and Depository Virtual Currency Wallet Operators (VASP) and Electronic Money Institutions and Payment Institutions sector (4 points).
The sectors rated as high ML risk are real estate, money remitters and accountants, auditors and tax consultants (3.4 points).
A total of 30 sectors consisting of financial institutions and other obliged entities were assessed for risk scenarios. The risk assessment analyses the associated risks and vulnerabilities, which are scored from 1 (low) to 4 (very high). The magnitude of the risk is determined by the combination of threat and vulnerability.
The overall risk level of ML in 2 sectors – VASP and Electronic Money Institutions and Payment Institutions – was found to be very high, high in 13 sectors, medium in 12 sectors and low in 4 sectors.
A very high level of risk with regard to terrorist financing (TF) has been identified in 2 sectors - VASP providers and money remittances, high – in 6 sectors, medium – in 7 and low – in 10 sectors, while in 6 sectors the risk was not assessed, as these sectors do not make it possible to carry out terrorist financing.
The sectors with the lowest level of ML risk were Free Economic Zones (1 point), Banking/Credit Products, Life Insurance and Bailiffs (1.4 points).
Threats in the riskiest sectors
VASP providers remain the riskiest sector for the second consecutive assessment, as they are often used by the criminal underworld, using virtual currencies and cryptocurrencies to complicate the identification of the person and the beneficiary, thus circumventing the applicable controls. Criminals use virtual currency exchanges without KYC procedures, unregulated personal virtual currency wallets, P2P payment transactions, VPN connections and privacy-oriented virtual currencies in order to conceal the sequence of transactions. The use of these tools makes it difficult to trace the movement of money and to identify senders and beneficiaries, which creates challenges in the fight against ML. The scale of ML is increasing across the sector due to its widespread availability and low-resource activity.
In the VASP sector, the threat of TF arises from the anonymity provided by virtual currencies and cryptocurrencies, the possibility of making illicit transfers between jurisdictions and the possibility of low-value transactions below the monitoring thresholds.
The e Electronic Money Institutions and Payment Institutions sector faces intense competition due to the large number of financial market participants, which in some cases leads to a higher exposure to the risk of MLTF by establishing business relationships with higher risk clients. Due to the higher risk portfolio of MLTF -risk clients, the wide geographical availability for the international movement of money and the possible anonymity of the products provided by the sector, there is a threat of ML and difficulties in effectively monitoring payment transactions. The risk is further exacerbated by the possibility that customers may submit false documents in order to circumvent the institution's ML controls.
The Electronic Money Institutions and Payment Institutions sector is exposed to TF due to the fact that the majority of the sector's transactions are cross-border payments, which enable the transfer of funds for TF across borders, making it difficult to identify the origin and purpose of the funds. In addition, in order to avoid enhanced customer identification, criminals make use of the readily available products provided by the sector, such as prepaid cards, etc.
About NRA
In order to identify and assess the existing money laundering and terrorist financing risks and their level in Lithuania and to ensure that mitigating measures are selected to reduce these risks, the third National Money Laundering and Terrorist Financing Risk Assessment of the Republic of Lithuania was carried out, covering the period from 2019 to 2022. The assessment was carried out in cooperation with all the authorities responsible for the implementation of measures to prevent money laundering and/or terrorist financing, as defined in the Law on the Prevention of Money Laundering and Terrorist Financing.
The national risk assessment of money laundering and terrorist financing shall be carried out at least every 4 years. The national risk assessment of money laundering and terrorist financing was carried out in accordance with the methodology approved by the Financial Crimes Investigation Service (FCIS).
After evaluating the results and conclusions of the National Risk Assessment, in 2024-2026, a plan of measures to reduce the risk of money laundering and terrorist financing of the Republic of Lithuania will be prepared.
Last updated: 09-06-2025
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