The Biggest Money Laundering Scandals in Sweden

In general, the Swedish financial sector is vulnerable to money laundering and terrorist financing. Also, It does not have a national AML / CTF mechanism. Therefore, it becomes essential for the country to establish a money-laundering prevention system. 

 

An effective regime in Sweden also prevents it from being the preferred country by criminals in money laundering and terrorist financing. 


According to the Mutual Assessment Report created by FATF in 2017, the Swedish regime performs well overall. However, an effective regimen requires an understanding of the risks and challenges. 


Anti-money laundering and combating terrorist financing have largely occupied the public debate in Sweden in the past period. It has taken important steps towards criminalizing money laundering and imposing severe criminal sanctions against this crime. In this article, we talked about money laundering scandals in Sweden and the systems implemented, and decisions to prevent such scandals and risks. 

 

Money Laundering Scandals in Sweden 

We heard the name Swedbank as the bank at the center of Sweden's biggest money-laundering scandal. Swedbank emphasized no good enough anti-money laundering system, so illegal transactions can continue in the wider financial system.  Swedbank was fined over $ 400 million in March 2020 for failing to stop suspicious flows. Nowadays, it has been working with the police and other banks to fight financial crime effectively. However, according to an audit conducted by a law firm at Swedbank, bank senior management failed to set effective limits to prevent money laundering between 2007 and 2019. 


Another bank involved in the money laundering scandal in Sweden was SEB.  The rumors that more than 45 million Euros were taken from companies linked to Russian money laundering by SEB Baltic branches soon became the agenda.  SVT's investigation revealed that 25 SEB customers registered transactions with 18 legal entities linked to the Magnitsky incident, who died in Russian custody in 2009. 


On the other hand, 90 individuals and institutions who are customers of SEB or who have carried out any SEB transaction are associated with money laundering cases.  This investigation revealed that most transactions worth all 200 billion euros belonging to the bank between 2007 and 2015 were "suspect." In the report published in October 2018, SEB stated that most of its activities are with local customers, and those suspicious transactions will not affect the international process. 


Money Laundering Laws and Regulations in Sweden 

There are two main anti-money laundering laws in Sweden. These are the Swedish Money Laundering and the Financing of Terrorism Act (Anti Money Laundering Act) and the Money Laundering Crimes Penal Code. Under these two laws, all entities subject to the law must have an AML compliance program. It should adopt a risk-based approach and develop policies to prevent money laundering.


Besides, The Swedish Financial Supervisory Authority (SFSA) is one of the main regulators in Sweden. Its main purpose is to increase efficiency in the financial system and protect consumer rights. SFSA is an agency under the ministry of finance. It is responsible for authorizing, monitoring, and supervising all financial companies in Sweden. 


How to Prevent Money Laundering in Sweden? 

The first step in preventing money laundering is knowing your customer and creating an environment for customer due diligence. Before opening a customer account, you need to obtain and evaluate your customer's information. Thus, you can create your customer's risk profile and take the necessary precautions against possible money laundering risks. 


Sweden has been identified as a risky country in terms of money laundering and terrorist financing. In addition, the lack of an adequate anti-money laundering system in the country encourages businesses to take stricter measures.  Businesses must establish their own anti-money laundering policies and comply with anti-money laundering regulations. 


Sanction Scanner offers solutions that help businesses fulfill their AML obligations. Thus, businesses can easily perform operations such as Know Your Customer, Customer Due Diligence, Transaction Monitoring and take measures against possible risks.

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