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The Baltic countries were virgin lands for major Scandinavian banks during the 1990s and early 2000s. It was possible to grow quickly and make big profits. There was also money, a lot of money, especially from the privatization of Russian companies in the 1990s.
But the golden age ended with the financial crisis and now comes the hangover: the realization that the local branches and subsidiaries of Scandinavian banks have been more or less open, above all, to the Russian oligarchs and corrupt politicians and officials to launder the proceeds of criminal activity.
In 2018 and 2019 Hit after hit revelations came. The worst was probably Danske Bank, but also Swedbank had a dirty historical mess that cost the bank four billion crowns in fines, “fines”, from Finansinspektionen (FI).
And now the center of attention has fallen on SEB, which already last summer received a billion in fines for being too lax in its work against money laundering.
You can say one thing at a time: there is a big difference between how Swedbank acted when the scandal broke in February last year and how SEB reacts now.
On the other hand, this is not a high rating for SEB – Swedbank’s reporting last spring was catastrophically lousy and cost both the CEO and Chairman of the Board their jobs.
At first sight puts the SEB cards on the table. In a lengthy press release, the bank says the information in UG “is nothing new” and strongly suggests that the 8.2 billion SEK in alleged money laundering should be included in the 260 billion SEK that the so-called “customers. low transparency “passed through the bank in Estonia in 2005 18. These are clients who were not Estonian residents and carried out transactions the purpose of which the bank knew very little, if anything.
According to SEB, the bank has closed these accounts for 2018. The bank has gradually taken steps to cut off contact with suspicious customers and has tightened its routines to prevent the bank from being used for money laundering.
But what remains is concrete and serious accusations from UG. These are clients whose behavior should have prompted the bank to immediately sever ties with them; don’t wait several years.
Customers who had business addresses with no operations, transfers to tax havens, transactions that had no clear legitimate purpose – these are all red flags that the bank should have seen.
SEB sidesteps the issues by referring in part to bank secrecy and in part to the fact that so-called suspicion reports (SARs) are tools for the financial police and the bank cannot comment on them.
When FI this summer distributed a billion crowns in fines to the SEB, it was precisely because there were deficiencies in the work against money laundering. According to FI CEO Erik Thedéen, the bank had “acted a little too late” when it came to money laundering risks in the Baltic countries.
The same can probably be said now that UG has presented his reveal. The bank acts, but very little and, above all, too late.
CEO Johan Torgeby may think he has answered questions and been clear. But it’s not enough. When journalists provide information as specific as UG reporters, he has to stand up for an interview. Otherwise, the scenario that now exists is confirmed: of a bank and a management that is trying to hide what has been a dirty operation. Because money laundering is dirty: it is about hiding proceeds from crimes where there are always victims.
Even if the bank avoids further sanctions from the authorities, it will not escape questions about money laundering. Not least, the FI review, in collaboration with the Estonian authorities, will ensure this.
