FCMC settles with Swedbank, bank to pay 1.36m euros
They are agreeing on the improvements to be implemented for efficient functioning of the bank’s internal control system in order to eliminate the deficiencies established in the inspection performed by the FCMC.
The agreement stipulates a fine of EUR 1,361,954 on Swedbank AS, and the penalty is lower than the maximum penalty under the law considering that the bank has already voluntarily commenced the elimination of the deficiencies established during the inspection and the implementation of the required improvements. The fine will be transferred into the government budget.
In the inspection, the FCMC has identified several infringements of the Law on the Prevention of Money Laundering and Terrorism Financing (AML/CTF) and its subordinate legislation at Swedbank AS, inter alia the bank had not paid sufficient attention to complex, inter-related transactions that had no apparent economic or visible lawful purpose.
Moreover, the bank had not obtained, in due time, documents and data on the customer economic/individual activities, including transactions performed by customers to a scope that would have made it possible to verify that they were not to be considered as suspicious, thus failing to ensure sufficiently efficient functioning of the internal control system.
According to the wording of the Credit Institution Law that had been in force as of the time of committing the breaches, the FCMC was entitled to impose a fine in the amount of up to 10% of the bank’s net income in the previous financial year, and this amount would be significantly higher than the size of the fine imposed on the bank in that case.
In setting the size of the fine to be imposed, the FCMC took into account that Swedbank AS had voluntarily commenced improvements in order to ensure that such violations would not occur in future and to perfect the bank’s internal control system in the AML/CTF field, inter alia by strengthening the compliance function, which includes increasing the personnel capacity and improvements in the IT solutions.
The FCMC considered also the fact that violations in the AML/CTF field had not been previously established at the bank.
The agreement includes also a decision made by Swedbank AS to fully cease the provision of financial services to those customers (non-residents) that increases the risk in the AML/CTF field for the bank.
With entering into the Administrative Agreement, the FCMC and Swedbank AS have agreed on further measures that the bank has undertaken to carry out within the specified timeframes in order to improve its internal control system in the AML/CTF field and strengthen the efficiency of its operation.
The FCMC will oversee that Swedbank AS meets the commitments made within the timeframes and to the scope specified in the Administrative Agreement. ■