Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Swedish bank SEB missed money laundering 'red flags' in Estonia: TV report

Stock MarketsNov 27, 2019 12:11AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

(Reuters) - Swedish Television (SVT) reported on Wednesday that it had obtained a list of 194 clients of Swedish bank SEB (ST:SEBa) connected to suspected money laundering in Estonia.

The public broadcaster's investigative show "Uppdrag Granskning" reported that the client list, which also showed about 2,000 transactions, contained "red flags" - names associated with well-known proxies for Russian non-resident companies suspected of money laundering.

SVT said the report was done in collaboration with the Organized Crime and Corruption Project consortium of investigative reporting, which provided a cache of leaked information.

SVT said the transactions included around 475 million Swedish crowns ($49.35 million) connected to the so-called Magnitsky affair in Russia. The money moved through SEB accounts, the broadcaster reported.

Sergei Magnitsky was a Russian lawyer arrested in 2008 after accusing Russian officials of involvement in large-scale tax fraud. He died in a Moscow prison in 2009 after complaining of mistreatment.

"I find it surprising that they didn't see, both within their own client base, but also within some of the counterparties who were paying through their client base, significant areas for concern," money laundering expert Graham Barrow said in the broadcast.

On Tuesday night SEB said in a statement that it had processed close to 26 billion euros ($28.66 billion) from non-resident Estonian customers between 2005 and 2018 that would not meet the bank's current standards of transparency.

SEB Chief Executive Officer Johan Torgeby's statement sought to defend the bank's record.

"In the comprehensive analysis that we have made of our business in the Baltics, we have not seen that SEB has been used for money laundering in a systematic way," he said.

"Still, at any given time, all banks are subjected to the risks that financial crime entail," Torgeby added.

In April, Torgeby said he was "comfortable" with how the bank had conducted itself in the past but that there were no guarantees.

The revelations risk bringing SEB deeper into a long running Baltic money scandal which has hammered the shares of rival Swedbank and Danish lender Danske Bank.

SEB had managed to stay clear of the scandal until Nov. 15 when SEB shares fell 13% after the bank said broadcaster SVT had contacted it about the report airing on Wednesday.

On Nov. 20, Swedbank's (ST:SWEDa) CEO Jens Henriksson said the bank wanted to "get to the bottom" of a suspected funds transfer from a Russian arms company, which SVT said may have violated U.S sanctions.

Swedbank has lost around 40% of its market value since allegations surfaced that its Estonian branch processed suspect gross transactions of up to 20 billion euros a year from mostly Russian non-residents between 2010 and 2016.

The scandal started in 2017 with Danske Bank, Denmark's biggest bank. In September 2018, CEO Thomas Borgen resigned and the bank detailed compliance and control failings.

Danske Bank is under investigation in several countries over 200 billion euros ($220 billion) in suspicious payments moved through its Estonian branch between 2007 and 2015 in one of the largest money laundering scandals uncovered.

At market close on Tuesday, SEB shares were down almost 8% since the start of the year. Before SEB's Nov. 15 statement, the bank had been trading up over 7% for the year.

Swedish bank SEB missed money laundering 'red flags' in Estonia: TV report
 

Related Articles

European, U.S. stocks stage tentative rebound
European, U.S. stocks stage tentative rebound By Reuters - Dec 06, 2021 19

By Julien Ponthus LONDON (Reuters) - European stocks opened higher on Monday while U.S. futures also traded in the black in a tentative rebound from last week when the spread of...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email