Denmark govt to impose harsher penalty on banks

Bloomberg

Denmark’s government and regulator are looking into tougher laws including the option of imposing harsher penalties on banks after repeated breaches by Nordea Bank AB suggested the existing framework is too weak. Business Minister Troels Lund Poulsen met with the head of the Financial Supervisory Authority, Jesper Berg, discuss measures that could be enforced.
The talks followed news that Nordea had been reported to police by the regulator after an inspection in 2015 revealed Scandinavia’s biggest bank had failed to comply with anti-money laundering rules. The bank has already been fined in Sweden for similar breaches.

Nordea’s Missteps
Nordea said on June 17 it was cooperating with the authorities and adding 300 people to its compliance unit. Chief Executive Officer Casper von Koskull, who has run Nordea since November, said he found the breaches “unacceptable” and pledged to make compliance “an absolute top priority.” He said the bank had initially “underestimated the complexity” of the task.
Danske Bank A/S, Denmark’s biggest lender and Scandinavia’s largest bank after Nordea, was reported to police for failing to comply with anti-money laundering laws. The bank said at the time it was cooperating with the authorities and improving systems to meet the “mounting challenges.”
The government, which is also looking into the practices of eight banks operating in Denmark in connection with the Panama leaks, is creating a task force that will include representatives from the Tax Ministry, Business Ministry and the FSA. Poulsen said it was likely that the Tax Ministry and the FSA will need to work more closely together in the future to ensure banks stay on the right side of the law.

Hidden ‘Dirt’
Berg said it would be naïve to think there isn’t more “dirt” hidden in the banking industry that subsequent reviews will uncover. “We don’t have access to information from all tax-haven countries so new cases could appear.”
Denmark’ FSA, which unlike its counterpart in neighboring Sweden has so far not had the option of handing out fines, may now be empowered to do so. Berlingske reported that a maximum fine of 50 million kroner (US$7.6 million) was being
discussed.
“It is unacceptable that a number of Danish banks, in clear contravention of the law, apparently continue to be at risk of assisting in money laundering,” Poulsen said in a statement on Sunday. “I find it worrying that the FSA’s initial report concludes that a number of the banks reviewed have a culture that lacks an adequate focus on the importance of anti-money laundering rules.”