Reporting on violations
Reporting on violations in the financial sector which are, in most cases, related to the activities of financial and capital market participants supervised by Latvijas Banka. For instance, reports on potential and actual violations may be carried out in the following areas:
- the activities of credit institutions;
- anti-money laundering and combating the financing of terrorism and proliferation;
- insurance and reinsurance distribution;
- the activities of alternative investment fund managers;
- the provision of investment management services;
- the provision of financial instrument market data reporting services and other violations in the financial instrument market;
- the activities of regulated market organiser;
- payment services;
- etc.
The procedure for submitting and examining reports is established in the Financial and Capital Market Commission's Regulations No 241 "Regulations on the Procedure for the Reporting of Actual and Potential Violations of Regulatory Provisions by a Person and Examining the Report by the Financial and Capital Market Commission" of 22 December 2020 (hereinafter – Regulations No 241).
Persons have the possibility to report potential or actual violations that affect the interests of the public (or a certain range of persons). If the report only affects personal interests, it is regarded as a submission of a personal nature and should be examined according to the general procedure.
Example of an understanding of a report
A person has subjective grounds to assume that a credit institution is breaching the requirements established in the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing for ensuring due diligence on a customer and its transaction, taking into account the circumstances the person has been subject to while employed by an employer that is a long-term customer of the credit institution. Although the person's employer has not been open with the credit institution, the credit institution, however, had the opportunity to obtain this information. Cooperating with the credit institution on a daily basis, the person has grounds to conclude that the credit institution has not undertaken any additional actions regarding the employer. Thus, the person has doubts about the appropriate operation of the credit institution's internal control system.
Example of a submission of a personal nature
The insurer has not reimbursed losses incurred due to a water leakage in an apartment. The person fails to understand the decision adopted by the insurer. The person asks for help in resolving the situation and for an explanation of the insurer's decision.
As of 1 January 2023, Latvijas Banka shall take over the property and financial assets of the Financial and Capital Market Commission and shall be the legal successor of its rights and obligations.
Contrary to the Whistleblowing Law, where a whistleblower is a natural person, a reporting agent can also be a legal person. A reporting agent can be any person and can also submit a report anonymously.
Like in the case of whistleblowing, reporting also involves protecting the identity of and the information provided by the reporting agent, including hiding (pseudonymising) personal data and other personal identity information.
A reporting agent may submit a report to Latvijas Banka in matters of its competence in the following ways:
- by filling in one of the report forms and by sending it to the e-mail address parkapumi@bank.lv;
- by using the Portal of State Administration Services www.latvija.lv;
- by submitting a submission in paper form to the contact persons at Latvijas Banka (K. Valdemāra iela 2A, Riga, LV-1050). The envelope should be marked with a text "Report on a violation in the financial and capital market sector";
- in person or by calling telephone number +371 67022300 and indicating that this is a "report on a violation in the financial and capital market sector".