Estonian🇪🇪 and Latvian🇱🇻 media uncover large-scale money laundering scheme involving proceeds from unregulated gambling

Estonian🇪🇪 and Latvian🇱🇻 media uncover large-scale money laundering scheme involving proceeds from unregulated gambling

Shell companies were registered in Estonia🇪🇪 in the names of Latvian citizens who provided their personal data in exchange for money.

📌 Scheme

🔺 Latvian citizens were listed as company owners and received a one-time payment of EUR 300-500 in cash for their personal data and a power of attorney granted to an Estonian citizen. In Estonia, a company can be registered remotely within a few days.

🔺 The person receiving the power of attorney registered a shell company, and the nominal "owner" was subsequently only required to confirm their details occasionally. Most Latvian citizens were unaware of what the companies registered in their names were doing.

🔺 Instead of activity code MCC 7995 ("gambling"), codes associated with IT or trade were used in order to avoid drawing attention to incoming funds.

🔺 Accounts were opened for the companies at financial institutions, after which the funds were transferred through a chain involving Latvia, Lithuania and Poland🇵🇱.

🔺 Latvian fintech Fyst, allegedly based in Dubai🇦🇪 but with a legal entity in Latvia, acted as an intermediary for attracting clients interested in opening accounts. Following publication of the investigation, Fyst's social media accounts were deleted.

🖋 Context: in 2025, the regulated gambling market in Latvia reached EUR 171 million, while the unregulated market amounted to approximately EUR 62 million. By 2030, the Latvian Treasury could lose up to EUR 90 million in tax revenue due to the operations of unregulated operators. Since 2014, the country has issued 4,176 blocking decisions against 597 organizers of illegal gambling.

#news #Europe

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