Thursday, October 29, 2020

Swedbank admits there was risk it was used for money laundering in Baltic

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Sweden’s Swedbank (SWEDa.ST) repeated on Friday that there was a risk it had been used to launder money, in a response to requests for comment by the Estonian and Swedish financial watchdogs on their separate probes into the bank.

Sweden’s oldest retail bank dismissed its CEO earlier this year and accepted the resignation of its then chairman after its Estonian business was caught up in money-laundering allegations that have also engulfed Danish peer Danske Bank (DANSKE.CO).

Swedbank said it shared many of the authorities’ observations and preliminary conclusions, adding there had been “insufficient internal governance and control to address deficiencies related to suspected money laundering”.

“These shortcomings have meant that there has been a risk that Swedbank and its subsidiaries have been used to launder money, which is unacceptable from the requirements and expectations, among others, customers, shareholders and supervisors, have of us,” Swedbank CEO Jens Henriksson said in a statement.

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The bank has previously admitted to failings in its money-laundering controls in the Baltic and a spokeswoman for Swedbank said Friday’s comment was part of the ongoing, formal dialogue between the bank and the regulators.

Authorities in Sweden and the Baltics are investigating Swedbank and the U.S. has also launched a probe. The bank has lost more than a third of its market value since the scandal broke in February.

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