Lithuania

1. Does Lithuania have legislation making it a criminal offence to engage in money laundering and/or terrorist financing?

Yes. Article 189 (Acquisition or Handling of Property Obtained by Criminal Means), Article 216 (Laundering of Crime-Related Property) and Article 250⁴ (Financing and Support of Terrorist Activities) of the Criminal Code of the Republic of Lithuania (further – “Criminal Code”) establish criminal liability for relevant criminal actions.

2. To whom does the legislation apply?

Individuals and legal entities (with some minor exceptions) are liable for criminal actions under Article 189, Article 216 and 250⁴ of the Criminal Code. Criminal liability for criminal actions under Article 216 and 250⁴ of the Criminal Code arises regardless of the citizenship and place of residence, also of the place of the commission of a crime and whether the act committed is subject to punishment under the laws of the place of commission of the crime.

3. What does the legislation prohibit?

Under Article 189 of the Criminal Code it is an offence to acquire, manage, use or realize property while being aware, that the property has been obtained by criminal means or by taking part in a criminal offence.

Under Article 216 it is an offence to acquire, manage, use, transfer the property to other persons, perform financial transactions related to such property or enter into transactions, use it in economic, commercial activities, or otherwise alter it or falsely state that it is the result of lawful activity, with the intent to conceal or legalize its own or other persons’ property or to help the other person participating in criminal activity to avoid legal consequences, with the knowledge that the property is derived from crime, or by participating in criminal offence, also, to conceal the actual nature of his own or another person’s property, its source, location, disposal, movement, ownership or other rights related to the property, while being aware that the property has been derived from crime or by participating in criminal offence.

Under Article 250⁴, it is an offence to directly or indirectly collect, accumulate or provide funds or other assets or to provide other material support to another person, with knowledge or with intent that the assets, support or part thereof would be used for the commission of a terrorist crime or a terrorist-related crime or support of one or more terrorists or a group which has a goal to perform terroristic crimes or to persons or groups which recruits or organizes terrorists or acts in terroristic activity in other ways.

4. How is money laundering defined? Does underlying criminal activity have to be proven?

The Criminal Code of the Republic of Lithuania does not provide a definition of money laundering, but the Law on the Prevention of Money Laundering and Terrorist Financing (“Law”) defines it as:

• the conversion of legal status or transfer of property, with the knowledge that such property is derived from a criminal act or from involvement in such an act, for the purpose of concealing or disguising the illicit origin of the property or of seeking to assist any person who is involved in the commission of such a criminal act to evade the legal consequences of this act;
• the concealment or disguise of the true nature, origin, source, location, disposition, movement, ownership right or other ownership related rights, in the knowledge that such property is derived from a criminal act or from involvement in such an act;
• the acquisition, possession or use of property, in the knowledge that at the time of acquisition/transfer such property was derived from a criminal act or from involvement in such an act;
• preparation, attempts to commit and complicity in committing any of the acts referred to in the above three points.

In terms of application of Article 216 of the Criminal Code, a person must know that the property has been acquired in a criminal way or by taking part in a criminal offence. However, in accordance with the relevant court practice, it is not obligatory to determine exactly where the income originated. It is sufficient that the financial sources for the acquisition of the assets have not been precisely identified, if an examination of all possible legal means of obtaining the said assets indicates that none of them could have been acquired in a legal manner.

5. What level of intent or knowledge is required to establish a violation?

Relying on Recommendations of the Prosecutor General of the Republic of Lithuania, application of Article 189 and Article 216 of the Criminal Code requires a person’s knowledge that the money is of criminal origin: obtained by criminal means or by taking part in criminal offence. Article 216 requires the same level of knowledge and additionally it may require intent to conceal or legalize such property, or help another person involved in a criminal offence to avoid the legal consequences. Some actions as described in Article 216 may require a person to have a certain purpose to conceal and legalize the property or to help another person involved in a criminal offence (for instance: acquiring, managing, using, transferring the property which is derived from crime, etc.) and some do not require such purpose to exist (for instance: concealing the actual nature, source, location, disposal, movement, ownership and related rights of the property).

Article 250⁴ establishes that a person must either have knowledge or purpose that the property would be used for terroristic activity, so it may be assumed that such an action can be performed only by direct intent. There is no relevant court practice in this respect.

6. What are the potential penalties for infringing the legislation?

According to Article 189 of the Criminal Code, a person may be punished by a fine or restriction of liberty, or by arrest or by imprisonment up to four years. A qualified crime (for instance: use of a high value property, etc.) may be punished by a fine or restriction of liberty, or by arrest or by imprisonment up to six years. If a low value property has been used, managed or realized a person may be punished by public works or fine or arrest. Fines for individuals range from 15 to 4000 minimum standard of living (MSLs). Currently, as of the year 2022, one MSL equals to EUR 46, so the potential fines are the following: EUR from 690 to EUR 184 000.

According to Article 216 of the Criminal Code, a person may be punished by a fine or imprisonment for up to seven years. Fines for individuals range from 150 to 6000 MSLs (EUR 6 900 – EUR 276 000).

According to Article 250⁴ of the Criminal Code, a person may be punished by imprisonment up to 10 years. Fines for individuals range from 150 to 6000 MSLs (EUR 6 900 – EUR 276 000) for individuals.

Fines for legal entities for committing any of crimes above may range from 200 to 100 000 MSLs (EUR 9200 – EUR 460 0000).

7. Does the legislation have extra-territorial reach?

Yes.

8. Are there additional anti-money laundering or counter terrorist financing regulations or obligations, such as registration or reporting obligations, for businesses or individuals that operate in particular sectors or undertake particular activities?

Additional regulations or obligations are applicable to financial institutions and other persons to whom obligations apply (auditors, bailiffs, accountants, notaries, attorneys at law, real estate brokers, other persons. They have certain obligations in relation to registration and reporting. For instance, the identity of the client and benefit receiver have to be checked and determined before the start of a business relationship. When carrying out a monetary transaction, financial institutions have an obligation to provide to the Financial Crime Investigation Service the data and information on a client’s identity and monetary transaction if the amount of the customer’s one-off cash transactions or several related cash transactions is equal to or exceeds EUR 15,000 or its equivalent in foreign currency. The Law also establishes exceptions when certain obligations do not apply.

The above are only a few examples of the registration and reporting related obligations, however the Law requires finance institutions and other obliged persons to comply with other requirements and duties (not only registration and reporting) as established by national and EU law.

9. What are the potential penalties for failing to comply with these obligations?

The following sanctions may be applied by the relevant authority: warning, fine, temporary removal from duties of relevant persons with the demand to terminate their powers/ employment contracts, temporary or permanent restriction of activity of entity or its affiliates, temporary or permanent restriction to dispose funds and/or other assets.

For failure to provide information or documents in a timely manner to the supervising authority or where false information is provided, a fine in a range from 0,1 to 0,5 % of gross annual income may be imposed.

In addition to the above, the Code of Administrative Offenses sets fines for individuals who violate the provisions of Article 198 on the procedure for the implementation of measures to prevent money laundering and terrorist financing and such action invokes a fine from EUR 500 to EUR 6000.

10. Who are the relevant enforcement authorities in Lithuania and what are their contact details?

The relevant enforcement authorities in relation to prosecution and judicial trial for criminal actions as set by the Criminal Code are:

Courts of general jurisdiction and courts of higher instance

The relevant authorities supervising implementation of anti-money laundering and terrorism financing measures under the Law are: