Denmark's FSA asks police to probe Nordea's compliance on money laundering
Investigation into Nordea Bank's Money Laundering Compliance
Background of the FSA's Request
COPENHAGEN, May 4 (Reuters) - Denmark's financial supervisory authority (FSA) said on Monday it had asked Danish police to investigate whether Nordea Bank has failed to comply with money laundering regulations on customer due diligence.
Findings from the FSA Inspection
Insufficient Customer Due Diligence
• The FSA said in a statement it had assessed that Nordea did not have sufficient knowledge of individuals within a larger group of customers who were issued with credit cards.
• The assessment was based on the FSA's inspection at the bank's Danish subsidiary Nordea Finans in June 2023.
Lack of Assessment and Documentation
• "The company did not conduct a sufficient assessment of why the customer wanted a credit card and what the credit card was to be used for," the watchdog said.
• It added that it assessed there was a systematic deficiency and that the notes Nordea had made in its customer files were insufficient to assess the purpose and intended nature of the business relationship.
• It said Nordea had also failed to conduct a risk assessment, including risk classification, for a large group of customers.
• "The company thus failed to address whether there were specific risk factors that, from a money laundering and terrorist financing perspective, entailed an increased risk associated with the customer relationship," it said.
Nordea's Response to the Allegations
Disagreement with the FSA's Assessment
• Nordea said it disagreed with the FSA's assessment, adding that its report to the police and its proposed fine were disproportionate.
Actions Taken by Nordea
• It said neither Nordea nor the watchdog had found any suspicion of money laundering in the cases and that it had already complied with two orders it received after the FSA inspection in June 2023.
• "We must make it clear that there is a difference between something that could have been better and something that is a criminal offence," the bank said.
Reporting Credits
(Reporting by Jesus Calero in Gdansk and Louise Rasmussen in Copenhagen, editing by Terje Solsvik)
