Latvia, the former Soviet state that's pressuring banks to clamp down on financial crime, has the most to do of any European Union member when it comes to tackling money laundering, a U.S. government report said

Latvia, the former Soviet state that's pressuring banks to clamp down on financial crime, has the most to do of any European Union member when it comes to tackling money laundering, a U.S. government report said. The Baltic country is the only EU nation without clear legal authority to seize assets related to financial crimes, the State Department in Washington said in its annual report. Latvia came out worst among 12 EU nations included in the U.S. list of the world's biggest money-laundering havens. ``Latvia's role as a regional financial center, its large number of commercial banks and those banks' sizeable non-resident deposit base continue to pose significant money laundering risks,'' the State Department said in the report, which it presented to Congress in Washington on March 4. Prime Minister Aigars Kalvitis's office said on March 1 Latvian banks have begun closing suspicious accounts since the government declared it would shut any lenders that didn't comply with its legislation designed to tackle financial crime. The U.S. report was compiled before the government's latest efforts. Latvia's 23 banks held $5 billion of non-resident deposits at the end of 2004, mainly from Russia and other parts of the former Soviet Union. That accounted for more than half of all money held in banks, according to the country's financial regulator.