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Swedbank may have misled U.S. over client links to Panama Papers - Swedish TV

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Swedbank may have misled U.S. over client links to Panama Papers - Swedish TV
FILE PHOTO: Swedbank sign is seen on the local headquarters building in Tallinn, Estonia March 25, 2019. REUTERS/Ints Kalnins   -   Copyright  INTS KALNINS(Reuters)
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By Esha Vaish and Simon Johnson

STOCKHOLM (Reuters) – Swedbank may have withheld information from U.S. authorities over suspicious financial transactions, Swedish Television said on Wednesday, adding to pressure on the bank which is under investigation over money laundering allegations.

State broadcaster SVT said Swedbank may have misled U.S. investigators over transactions by its customers linked to Mossack Fonseca, a Panamanian law firm at the centre of a tax avoidance and money laundering scandal that has drawn in companies and individuals from around the world.

The Swedish lender, whose shares fell 4.5 percent on the news, said in an emailed response to Reuters that it “cooperates fully and communicates clearly, correctly and with the best intentions with all relevant authorities”.

“Current legislation does not allow Swedbank to comment on the existence or contents of any confidential potential communication with the New York State Department of Financial Services,” it said.

The Swedish lender has lost a quarter of its value after being dragged into a Baltic money laundering scandal which centres around Danske Bank’s Estonian branch being used for 200 billion euros ($227 billion) of suspicious payments between 2007 and 2015.


Regulators in Sweden, Estonia, Latvia and Lithuania began investigating Swedbank after SVT in February reported allegations that 50 clients transferred at least 40 billion crowns ($4.3 billion) between Baltic accounts at Swedbank and Danske Bank over the same period.

Media reports have since said the total sum of money linked to suspicious transactions is around $10 billion and alleged Swedbank’s management knew it had failed to report such transactions but failed to take corrective action.

Swedbank has in each instance said it cannot comment on specific transactions or details about clients due to banking confidentiality laws.

CEO Birgitte Bonnesen has repeatedly said she has confidence in the lender’s anti-money laundering procedures and that the bank reported suspicious transactions to authorities where identified.

Bonnesen, who was chief audit executive between 2009 and 2011 — a job which included overseeing the bank’s anti-money laundering policy — and consequently headed the lender’s Baltic operations until 2014, has kept the board’s support so far.

But in recent days investors have criticised Swedbank’s handling of the issue, as well as a heavily-redacted external report, setting up for a showdown with management at the company’s annual general meeting on Thursday.


Citing confidential documents obtained by the broadcaster, SVT said on Wednesday that Swedbank told the New York State Department of Financial Services it only had customers from Sweden and Norway with ties to Mossack Fonseca.

That was despite the fact that a number of companies with ties to the law firm had done business through Swedbank in the Baltics, SVT said.

The U.S. Embassy in Sweden, which in February asked the country’s financial watchdog for a meeting to discuss the allegations about Swedbank, did not immediately have a comment.

Sweden’s financial watchdog also had no immediate comment, while the U.S. Department of Justice, the U.S. SEC and the New York State Department of Financial Services were not immediately reachable for comment outside of regular U.S. business hours.

(Reporting by Stockholm Newsroom, editing by Louise Heavens, Niklas Pollard and Kirsten Donovan)

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