25.10.2026
On amendments to the AML/CTPF Law providing for the transfer of closed-account balances to the State if the funds are not withdrawn within 5 years after the account is closed
In connection with the amendments to the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing (the AML/CTPF Law) that entered into force on 15.10.2026, we inform you that the funds of clients who meet the criteria set out in Section 43(2¹) of the AML/CTPF Law will devolve to the State if, within six months from the date on which Section 43(2¹) of the AML/CTPF Law entered into force (i.e. by 15 April 2027), those clients do not exercise the rights set out in Section 43(2) of that Law.
Section 43(2¹) of the AML/CTPF Law (“Termination of Business Relationship”):
“(2¹) If, in the cases specified in this Law, a credit institution or financial institution has terminated, on its own initiative, a business relationship with a client that is not a natural person resident in Latvia, by closing and documenting the closure of the client's accounts, and after the closure the credit institution or financial institution holds a positive balance on the client's accounts, and the client has not exercised the rights referred to in Section 43(2) of this Law in respect of that balance within five years from the termination of the business relationship, the client loses its claim rights against the credit institution or financial institution in respect of those funds. The credit institution or financial institution shall check once a year whether a client with whom the business relationship has been terminated meets the conditions set out in this paragraph. Funds in respect of which the client has lost claim rights in accordance with this paragraph devolve to the State as ownerless property (financial funds). If the credit institution or financial institution establishes that the circumstances specified in this paragraph have arisen and that the funds devolve to the State as ownerless property, the credit institution or financial institution shall, no later than within 30 days, pay the property devolving to the State (the financial funds) into the account designated by the State Revenue Service. The credit institution shall send to the State Revenue Service information on the funds paid in, indicating the identifying information of the account holder that corresponds to the information specified in the Account Register Law. This paragraph does not apply where the funds concerned have been frozen in accordance with this Law, seized in accordance with the Criminal Procedure Law, or are subject to recovery under the procedure laid down in the Civil Procedure Law.”
The rights provided for in Section 43(2) of the AML/CTPF Law (“Termination of Business Relationship”):
“(2) If, in the cases specified in this Law, a credit institution or financial institution terminates, on its own initiative, a business relationship with a client by closing the client's accounts, the credit institution or financial institution shall, in accordance with the client's instructions, transfer the funds held in those accounts to the same client's settlement account at another credit institution or financial institution, or to a specified settlement account at another credit institution or financial institution, if such action is consistent with the assessment of the risks associated with the transfer of those funds, or to the account from which the funds were previously received. If the client has no settlement account at another credit institution or financial institution, or if it is not possible to make a transfer to another account or to the account from which the funds were previously received, the funds shall be paid out in cash, provided that the total amount does not exceed EUR 7,200. If there are suspicions of money laundering or terrorism and proliferation financing, the credit institution or financial institution shall report this to the Financial Intelligence Unit in accordance with Section 31⁴ of this Law. If the credit institution or financial institution has grounds to refrain from carrying out a transaction, it shall neither transfer nor pay out the funds held in the accounts, but shall act in accordance with Section 32 of this Law. If a temporary account that was opened for the purpose of establishing a commercial company is closed, the funds shall be paid out, in the manner provided for in this paragraph, to the person who deposited them.”
Impact on the Company's clients
Since the Company began providing financial services on 17.04.2025, the first year in which funds devolving to the State, and payable into the account designated by the State Revenue Service, could be identified in the Company's annual check is 2030.
