Nordic banks pool resources to fight money laundering

STOCKHOLM (Reuters) – The Nordic region’s six major banks are joining forces to set up a customer checking center to crack down on money launderers, part of efforts to recover from a scandal that has shaken confidence in the finance industry.

Danske Bank and Swedbank have lost billions from their market value after becoming embroiled in a money laundering scandal involving their businesses in the Baltics.

The banks have promised to take steps to rectify shortcomings, such as their planned joint venture with rivals Handelsbanken, Nordea, SEB and DNB to perform common customer checks.

Regulators and banks see these so-called “know your customer” (KYC) checks as a safeguard against money laundering as the process of verifying the identity of customers, companies and business associates can help banks to spot or monitor suspicious clients.

“Preventing financial crime is a top priority and a strong driver behind this initiative,” Fredrik Millde, project manager of the venture, known as Nordic KYC Utility, told Reuters.

The banks have not worked together previously, but the international nature of money laundering and the difficulties preventing it has persuaded them to join forces.

The new body is expected to create a standardized KYC process for large and midsize Nordic corporate customers across the six banks and Millde expects it to start providing services from 2020 and also sell its services to other banks.

Five of the six banks first announced the venture in May 2018. Swedbank joined later in the year. The banks have not said how much they are spending on it.

The finance industry have been under pressure to take action quickly because of criticism by regulators of their anti-money laundering controls.

Source: Reuters

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