Tens of billions in potentially suspicious funds passed via SEB Estonia

SEB headquarters building in Tornimäe, Tallinn.
SEB headquarters building in Tornimäe, Tallinn. Source: Siim Lõvi/ERR

Potentially suspicious transactions worth tens of billions of euros passed through Swedish bank SEB's Estonian arm in the period 2005-2018, Baltic News Service reports.

According to BNS, SEB's own data, which it presents in graph form (see picture below), in the period 2005-2018, €25.8 billion in potentially suspicious funds moved via SEB Estonia, which daily Postimees says is significantly higher than the Swedish media – which had been looking at the bank's activities – had previously thought.

As reported on ERR News, SEB announced in mid-November that it had been contacted by Sedish public broadcaster SVT's investigative news program Uppdrag Granskning, in connection with a report in an upcoming TV program on suspected money laundering in the Baltic States, a program which included information on SEB.

SEB has already issued several announcements since then, BNS reports, and on Tuesday issued a press release in which it said it had "taken considerable measures in order to minimize the risk of being exploited for money laundering in the Baltics.

"From 2006 and onwards, SEB has been working in a structured and determined way, in order to reduce the risk of being exploited in money laundering activities in the Baltic countries. After receiving criticism from the Estonian financial supervisory authority and information from another external source in 2006, the bank took several active decisions in order to reduce risk exposure related to money laundering. A large number of customer relations were ended. As new information has emerged, SEB has continuously ended customer relations and has been reporting suspicious activities to relevant financial police," the press release continued.

SEB also noted a desire to continue to be transparent, and presented its historical data for the Baltic region in an accompanying graph.

The bank said that "low-transparency customers" money flows declined early on in the period analysed (2005-2018) and make up a diminishing proportion of total payment flows from non-resident customers, noting that even these do not necessarily equate to money laundering.


SEB graph showing non-resident money flows, as well as "low transparency" volumes, at SEB Estonia 2005-2018. Source: SEB


"These flows can not be equated to confirmed money laundering activities, but there is rather an increased risk for money laundering here," the press release said.

Approximately 95 percent of the historical low-transparency-flows noted above stem from Estonia; the bank defines "low-transparency-customers" as those whose historical payment flows to a large extent do not meet today's transparency standards and links to authentic business activity.

SEB added that it had conducted a thorough analysis of each individual customer relationship, and categorized these based on the bank's knowledge of its operations and payment flows, with an increased focus on Estonia, the location of the majority of the transactions in question.

The bank reiterates that it does not think it has been systematically used for money laundering, adding that it experiences the same vulnerabilities to financial crimes that all banks do.

"We have been perceptive to signals of foul play and taken action, when needed. In the comprehensive analysis that we have made of our business in the Baltics, we have not seen that SEB has been used for money laundering in a systematic way. Still, at any given time, all banks are subjected to the risks that financial crime entail," Johan Torgeby, President and CEO of SEB, said, according to the press release.

SEB says its review is part of the basis for the investigation conducted by Sweden's financial supervisory authority in collaboration with its Baltic counterparts.

The bank also says that if new, relevant information emerges which it had not been made aware of before, it would take action.

An SVT report in February claimed that around €3.8 billion in potentially illicit funds moved between Swedbank Estonia and the now-defunct Estonian branch of Danske Bank. Investigations are ongoing.

As much as €230 billion in potentially laundered money is thought to have been moved via Danske in Estonia between 2007-2015.

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Editor: Andrew Whyte

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