Danish regulator’s bank job

Denmark’s Financial Supervisory Authority (Finanstilsynet) warned on March 19 of a “high risk”  the Spar Nord bank could be used to launder money and finance terrorist activities.

The regulator stated that Spar Nord, which is Denmark’s sixth-largest bank, had received a number of checks and procedures that it must introduce to “prevent, limit and control” the possibility of money laundering and terrorism financing.

The announcement was the outcome of a Finanstilsynet inspection in November 2023 to detect whether the bank was complying with Denmark’s regulations on money-laundering.

Periodic inspections and subsequent recommendations are the result of the 2018 historic money-laundering scandal involving Danske Bank, Denmark’s largest bank which between 2007and 2015 had allowed €200 billion of non-resident money to pass through its Estonian branch.  A “significant” amount of this was found to be suspect.

In September 2020, S & P Global Market Intelligence reported that the Finanstilsynet had found “several gaps” in the anti-money-laundering controls at Nykredit Bank, Jyske Bank, Sydbank and Spar Nord as well as the Danish branch of Sweden’s Svenska Handelsbanken.

After assessing each bank’s likelihood of being used for money laundering or terrorist financing, Handelsbanken’s risk was classified as “normal to high” while the risk for the remainder was “high.”

Handelsbanken, Sydbank and Jyske Bank each received orders to make improvements within transaction monitoring, while Nykredit and Spar Nord were told to improve multiple areas of their know-your-customer procedures.

Spar Nord, for example, was also ordered to carry out stricter customer due diligence for higher-risk customers.