Why banks ask. AML/CTF regulations and “Know Your Customer” Principle.

Criminals are known to use financial services as a way to legalize or “launder” dirty funds obtained from illegal activities. This way making it possible for them to later freely utilize the money or to further fund criminal activities. Money-laundering and terrorism not only harm the whole society, but can also damage the stability and reputation of the financial sector. Therefore, it is obviously in the financial industry's and society's best interests that financial institutions take all reasonable measures to prevent Money-Laundering and Terrorist Financing.

Saldo Bank UAB, as a socially responsible financial institution, has zero tolerance for financial crime and aims to prevent its financial services from being abused by criminals by employing best international practices as well as adhering to the legal regulatory requirements in the area of Anti-Money Laundering and Counter Terrorism Financing.

Regulatory landscape requires financial institutions to perform customer due diligence, perform business relationship monitoring, to detect and report suspicious activities to competent state authorities. Fulfilling aforementioned mandatory legal requirements is achieved by applying “Know Your Customer” principle:

• We have to know the identity and background of our customers.
• We have to understand what the routine financial activities of our customers are.
• Therefore we ask questions about purpose and nature of banking relationship, registration details, residence and income generating countries, beneficial owners as well as area of business activity or professional background
• We are legally obliged to monitor our customers’ operations and to ensure that they correspond to our customer’s known background. When necessary, we ask for additional information about the transactions (e.g. the origin of the funds).
• From time to time we shall ask our customers to update or specify the “Know Your Customer” related information.

Please read more information about AML/CTF obligations at the Frequently Asked Questions section on the website of the Bank of Lithuania: FAQ | Bank of Lithuania (lb.lt)