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The former CEO of Swedbank charged with fraud and market manipulation following money laundering investigations

10/01/2022

The former CEO of Swedbank has been charged with fraud and market manipulation following investigations into money laundering in the Baltics. If convicted, she could face up to six years in prison.

Birgitte Bonnesen was chief executive of Sweden’s oldest bank in 2016.

She was sacked in 2019 when investigations into money laundering through Swedbank’s Baltic branch found that high-risk clients had carried out more than €37bn of transactions with a high risk of money laundering between 2014-2019.

An internal Swedbank report, seen by public broadcaster SVT, found that €80bn of money flowed through the non-resident client business of the bank in the Baltics from 2008 until 2013, most of it from Russia and ex-Soviet states.

But Bonnesen repeatedly spread “misleading information” that the bank did not have any issues with its anti-money laundering (AML) processes in Estonia, according to Sweden’s Economic Crime Authority.

Chief prosecutor Thomas Langrot said she either intentionally or through gross negligence disseminated misleading information about the state of the bank’s AML measures while being aware of “extensive and serious shortcomings” with the bank’s compliance systems.

Bonnesen’s lawyer says she is innocent and would be acquitted. “It’s important to see that the prosecutor is not saying she did anything for her benefit, and she has not bought or sold one single share,” he told Reuters.

Swedbank has said it will not file claims for damages against its former top executive and board. No trial date has been announced.

Swedbank was fined 4 billion crowns (€389.8m) in 2020 by Sweden’s financial watchdog for:

  • Severe deficiencies in its AML processes and
  • For withholding information from authorities investigating its role in the scandal, which also implicated Denmark’s Danske Bank.

US regulators are currently investigating both Swedbank and Danske Bank over money laundering scandals amounting to hundreds of billions of euros through their branches in the Baltics.

The CEO of Danske Bank resigned in 2018 after admitting that most of the €200bn flowing through its Estonian branch were laundered cash flowing illegally out of Russia, the UK, and the British Virgin Islands.

The head of the Danish Financial Supervisory Authority (FSA) commented in 2020 that many of the problems that had led to money-laundering failures at Danske Bank resulted from a ”silent” deferential culture within the institution.

For compliance teams, these cases

  • Emphasize the need for clearly documented and publicized AML policies and procedures – and the importance of communicating these to key executive stakeholders who are not involved in day-to-day compliance operations.
  • Remind us that establishing a culture of transparency, and demonstrating the benefits of a proactive approach to identifying and remediating AML violations, is also critical.
  • Highlight both the ongoing transformation of the Baltic region into a growing fintech hub and the inherent risks of operating in former Soviet states. Firms need to calibrate a risk-based approach to the geopolitical reality of doing business in this region.
  • Demonstrate that regulators are prepared to go beyond fines in certain circumstances and that senior managers are not immune to prosecution.
  • In 2021, several senior managers at EU banks were put under the spotlight, including bribery and money laundering charges levied against
Source

https://complyadvantage.com/insights/former-swedbank-ceo-faces-prison-for-alleged-aml-violations/?utm_source=Pardot&utm_medium=email&utm_campaign=Jan10_newsletter

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As well as owning and publishing Comsure's copyrighted works, Comsure wishes to use the copyright-protected works of others. To do so, Comsure is applying for exemptions in the UK copyright law. There are certain very specific situations where Comsure is permitted to do so without seeking permission from the owner. These exemptions are in the copyright sections of the Copyright, Designs and Patents Act 1988 (as amended)[www.gov.UK/government/publications/copyright-acts-and-related-laws]. Many situations allow for Comsure to apply for exemptions. These include 1] Non-commercial research and private study, 2] Criticism, review and reporting of current events, 3] the copying of works in any medium as long as the use is to illustrate a point. 4] no posting is for commercial purposes [payment]. (for a full list of exemptions, please read here www.gov.uk/guidance/exceptions-to-copyright]. Concerning the exceptions, Comsure will acknowledge the work of the source author by providing a link to the source material. Comsure claims no ownership of non-Comsure content. The non-Comsure articles posted on the Comsure website are deemed important, relevant, and newsworthy to a Comsure audience (e.g. regulated financial services and professional firms [DNFSBs]). Comsure does not wish to take any credit for the publication, and the publication can be read in full in its original form if you click the articles link that always accompanies the news item. Also, Comsure does not seek any payment for highlighting these important articles. If you want any article removed, Comsure will automatically do so on a reasonable request if you email info@comsuregroup.com.  

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As well as owning and publishing Comsure's copyrighted works, Comsure wishes to use the copyright-protected works of others. To do so, Comsure is applying for exemptions in the UK copyright law. There are certain very specific situations where Comsure is permitted to do so without seeking permission from the owner. These exemptions are in the copyright sections of the Copyright, Designs and Patents Act 1988 (as amended)[www.gov.UK/government/publications/copyright-acts-and-related-laws]. Many situations allow for Comsure to apply for exemptions. These include 1] Non-commercial research and private study, 2] Criticism, review and reporting of current events, 3] the copying of works in any medium as long as the use is to illustrate a point. 4] no posting is for commercial purposes [payment]. (for a full list of exemptions, please read here www.gov.uk/guidance/exceptions-to-copyright]. Concerning the exceptions, Comsure will acknowledge the work of the source author by providing a link to the source material. Comsure claims no ownership of non-Comsure content. The non-Comsure articles posted on the Comsure website are deemed important, relevant, and newsworthy to a Comsure audience (e.g. regulated financial services and professional firms [DNFSBs]). Comsure does not wish to take any credit for the publication, and the publication can be read in full in its original form if you click the articles link that always accompanies the news item. Also, Comsure does not seek any payment for highlighting these important articles. If you want any article removed, Comsure will automatically do so on a reasonable request if you email info@comsuregroup.com.