Nordea Faces Charges for Multiple Violations of Denmark’s AML Laws

Nordea, the largest bank in the Nordic region, has been charged with multiple violations of Denmark’s anti-money laundering (AML) laws in transactions with Russian clients amounting to nearly €3.8 billion, police announced on Friday.

The Special Crime Unit (NSK) believes Nordea breached the law by failing to sufficiently investigate transactions by Russian customers and ignoring warnings about transactions involving currency exchange offices in Copenhagen. According to the NSK, the case involves transactions exceeding 26 billion crowns ($3.77 billion).

The investigation into Nordea’s AML controls commenced in 2016, and the bank has made provisions of €95 million for expected fines.

“Nordea does not agree with the content of the charges nor the legal assessment,” the Finland-based bank stated, emphasizing its stance on its “adequate current provisioning for weak anti-money laundering processes and procedures.”

The NSK asserted that Nordea has breached its obligations on multiple occasions, leading to over 26 billion crowns flowing into the bank under suspicious circumstances potentially linked to money laundering.

Despite anticipating fines, Nordea contests the legality of the charges. The developments follow investigations by authorities into the bank's AML controls dating back to 2015.

“Based on Nordea’s interpretation of Danish law, Nordea does not agree with the content of the charges nor the legal assessment,” the bank reiterated.

The Danish National Special Crime Unit (NSK) announced that it will initiate court proceedings and file formal charges against Nordea. Investigators claim Nordea violated Denmark’s anti-money laundering act between 2012 and 2015 by inadequately investigating transactions by Russian customers and disregarding warnings about transactions to Copenhagen currency exchange offices.

Although contesting the charges, Nordea acknowledges weak AML controls and expects fines, having provisioned for a monetary penalty.

“Nordea does not agree with the legal assessment made by the authorities, a position supported by three separate external legal assessments, and maintains that the bank is adequately provisioned based on current circumstances,” Nordea declared this morning.

Nordea expects fines in Denmark for past weak AML processes and has made provisions for ongoing AML matters. The Danish Financial Supervisory Authority investigated in 2015 whether Nordea Bank Danmark A/S had adequate processes to combat money laundering.

The investigation led to orders by the Danish Financial Supervisory Authority, which did not mention specific money laundering or intentional breaches of legislation, nor did it accuse any individuals of wrongdoing.

In June 2016, the matter was referred to the Danish Prosecution Service for further investigation.

“Today, the National Special Crime Unit has announced that it will commence court proceedings against Nordea in Denmark in this previously disclosed anti-money laundering matter. Based on Nordea’s interpretation of Danish law, Nordea does not agree with the content of the charges nor the legal assessment,” the bank stated.

“In Q1 2019, Nordea made a provision for anti-money laundering-related matters and has reviewed the provision level on an ongoing basis. Based on current circumstances, and supported by three separate external legal assessments, Nordea believes that the current provision is adequate to cover this matter,” the bank added.

Nordea has been working transparently with Danish authorities for nearly nine years and will await the court’s decision.

“In recent years, Nordea has invested heavily in fighting money laundering and other financial crime and collaborates closely with the authorities to stop criminals and their activities,” the bank added.

By fLEXI tEAM