Legal pressure against Stockholm-based Swedbank, one of several banks at the center of a massive money laundering scandal, continues to escalate.
At the center of the money laundering saga are suspicious payments totaling 200 billion euros originating from Russia and elsewhere linked to Danske Bank’s Estonian branch between 2007 and 2014. Bill Browder, the co-founder and CEO of investment fund Hermitage Capital Management who has campaigned for Danske Bank to be held more accountable for €200 billion (U.S. $226 billion) of suspicious payments, reportedly also filed a criminal complaint this month with Swedish prosecutors over Swedbank’s link to the money laundering scandal.
Swedbank’s troubles started on 20 February, when a Swedish television program alleged that at least 40 billion kronor (U.S. $4.25 billion) had moved between Swedbank and Danske accounts between 2007 and 2015. The report prompted the Estonian and Swedish financial authorities to file a joint investigation into the allegations. The Latvian FSA and the Bank of Lithuania has also agreed to participate in the investigation with whatever assistance that might be needed by the Swedish and Estonian authorities.
“It is extremely important that the banks’ senior management and boards of directors view these matters seriously and take all necessary actions to ensure compliance with laws and regulations,” the Estonian FSA and the Swedish FSA said in a statement.
Erik Thedéen, director general of the Swedish FSA, said, “The information disclosed by SVT is very serious and together with our Estonian colleagues we will thoroughly investigate the matter to make a comprehensive and in-depth assessment.”
Swedbank originally appointed EY “to analyse material and conduct an external investigation about the information presented on the news program ‘Uppdrag granskning’ on Swedish Television,” the bank said. On 26 February 2019, however, Swedbank announced that it had decided to replace EY with Forensic Risk Alliance (FRA) “to secure that the external investigation meets necessary demands.”
In a statement at the time of appointing EY as its auditor, Swedbank President and CEO Birgitte Bonnesen said, “We take the report presented on Uppdrag granskning very seriously. Preventing and averting money laundering is one of the bank’s most important responsibilities. Therefore, I have given EY a broad mandate to independently and thoroughly investigate the information that was presented on the TV programme.”
In a statement made on 26 February, Swedbank said that the FRA “will report the results of the investigation to the CEO and Swedbank’s board of directors, no later than before the Annual General Meeting, which is to be held on March 28, 2019. The result will then be presented to other stakeholders.”