The two Latvian banks that the U.S. government claims are “a danger to the international community” say they adhere to their nation’s banking regulations.

Multibanka and VEF banka, two of the nation’s smaller banks, were singled out April 21 by the U.S. Treasury Department as “primary money laundering concerns.” The Treasury Department is proposing that American banks not be allowed to have dealings with the two Latvian banks.

Svetlana Dzene, chair of Multibanka’s board of directors, said in an April 22 statement posted on the bank’s Web site that the institution doesn’t understand the U.S. government’s action. Multibanka doesn’t have any unidentified clients and has no information about any clients engaged in financial fraud, Dzene said. The U.S. government’s action, she added, threatens the bank’s reputation.

VEF banka, in an April 22 statement posted on its Web site, said that since last autumn it has not received any requests from correspondent banks, including those in the United States, questioning the legality of funds. The U.S. government’s action, VEF banka said, was completely unexpected.

The Treasury Department action was taken under a provision of the USA PATRIOT Act, which generally addresses concerns about terrorism.