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Swedbank slides as further allegations emerge

By Rosie Murray-West

New CEO pledges to complete internal probe as Swedish broadcaster raises money laundering questions

Sweden’s oldest bank pledges to wrap up money laundering allegation as new broadcast alleges that transfers breached US sanctions against Russia

Swedish lender Swedbank has said it will conclude an internal probe into allegations of money laundering by early next year. Its shares slid 3 per cent in early trading after the nation’s public broadcaster named it in a programme about money funnelled to Russia.

The news programme, Uppdrag Granskning, aired on SVT’s website, alleged that Swedbank transferred money from Russian arms firm Kalashnikov to a US subsidiary through the business network of a Russian oligarch. US authorities are investigating the bank after SVT handed over the information it received, the broadcaster said.

Swedbank was already carrying out the internal probe into money laundering after extensive allegations, which have forced the resignation of several executives including the former CEO. The bank, which is Sweden’s oldest, is being investigated in Estonia, Latvia, Sweden and the US amid allegations that it may have taken part in more than $100bn (£77.5bn ,€90.3bn) of potentially suspicious transactions.

The bank said in a statement following the broadcast that it had received a document during an interview with SVT on November 7, which was handed over to Swedbank’s internal investigation team headed by the international law firm Clifford Chance.

According to Clifford Chance, information in the document was, if relevant to the investigation, already known to the internal investigation.

“It is a good thing that the bank is being investigated and I welcome Uppdrag Granskning’s reporting,” said Jens Henriksson, president and CEO of Swedbank. “If there has been unethical behaviour as described by Uppdrag Granskning, we should of course get to the bottom of it. The internal investigation is expected to be concluded in early 2020. Conclusions from the investigation will be communicated.”

The cost of the investigation is already impacting on Swedbank’s bottom line. Last month it posted a bigger than expected drop in quarterly earnings, citing compliance costs.

The bank said it is working on a comprehensive programme to improve routines, system support and processes, thus strengthening the bank’s ability to combat money laundering and other financial crime.

The programme includes 132 different initiatives of which 71 are expected to be completed during the fourth quarter of 2019, Mr Henriksson said.

FURTHER READING: Swedbank slides as further allegations emerge

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