Sweden’s financial supervisory authority is investigating Swedbank for suspected breaches of market-abuse regulations.
The bank released a statement on Friday the 18th of September, saying that “the investigation relates to the disclosure of insider information and the obligation to establish an insider list in connection with the disclosure of suspected money laundering within the company”.
The Swedish authority has confirmed the investigation and that the bank is assisting with the inquiry.
According to the WSJ article, back in 2019, a TV show reported that the Swedbank branch in Estonian has received illicit funds of around 230 billions of dollars. It created pressure to the bank that reported outlining deficiencies in its anti-money-laundering compliance and risk management controls.
At the time, Swedbank hired an external auditor with Danske ties. This decision raised questions about Swedbank compliance procedures and the ability to monitor conflicts of interest. As a result, the bank could not prove to the regulator their ability to respond with transparency to the crisis and lacked procedures to effectively detect suspicious transactions.
“They (Swedbank) made some attempts, but they didn’t do enough to gain the confidence of the regulators or the public that they were doing a legitimate and thorough review.” Julie Myers Wood, Chief Executive of Guidepost Solutions LLC.
In early 2020, the Swedish FSA fined Swedbank 4 billion Swedish kronor for deficiency in its anti-money-laundering measures in addition to its poor cooperation during the investigation. And according to WSJ a law firm hired by the bank concluded that the bank had inadequate systems to manage money-laundering risk, however, Swedbank did not engage in money laundering.
After all the pressure and a long reputational crisis, Swedbank has changed some of its leadership team, including the hiring of top risk and compliance executives. The new hires include a new Chief Executive and a permanent Chief Compliance Officer. And recently, the bank named Rolf Marquardt as its new Chief Risk Officer.
The original article was written by Dominic Chopping, The Wall Street Journal, 18 September 2020.
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