Minister of Finance and chairman of the supervisory board of the Financial Supervision Authority (FSA) Toomas Tõniste (Pro Patria) said that the supervisory board unanimously supported the FSA's activities thus far in the field of financial supervision pertaining to the hindering of money laundering, as in the case of Danske Bank.
"As a result of these activities, the FSA closed the risks originating from the servicing of non-resident customers of Danske Bank and Versobank and directed the former Krediidipank to a change of ownership, with which the bank's business model also changed," Tõniste said in a press release. "I am glad to acknowledge that the authority has consistently assessed its work processes critically and developed information gathering, analysis and supervisory processes."
The authority's supervisory board at a regular meeting on Monday received an overview from the management board regarding the FSA's activity in the field of financial supervision pertaining to the hindering of money-laundering, including a thorough analysis of the proceedings regarding the Estonian branch of Denmark's Danske Bank.
The FSA in 2014 carried out two anti-money laundering-specific on-site inspections at Danske Bank's Estonian branch to assess the risk management organisational framework at the bank. The financial watchdog issued a precept to the bank's Estonian branch in 2015, as a result of which the bank would cease to provide financial services to risky non-resident customers.
The work of the FSA in the supervision of the risk management systems of financial institutions has continued and will also continue after the aforementioned Danske case. As a result of the work of the financial watchdog, banks have changed their business models, and the activity of several financial intermediaries who ignored requirements has been significantly restricted or halted altogether.
In addition, the supervisory board also heard and discussed the authority's proposals regarding legislative drafting, institutions and processes, which will be submitted for further handling to the anti-money-laundering government committee.
One of the strategic priorities of the FSA is to help aid the hindering of money-laundering with financial supervision activity. The FSA is in touch with the hindering of money-laundering first and foremost by controlling the risk management of financial intermediary organizations under its supervision to ensure that the risk management meets the law, business strategy and risk appetite.
Among other things, the FSA has successively developed the methodology of financial supervision, significantly increased the number of on-site checks and emphasised the importance of the topic to the top executives of financial intermediaries.
Editor: Aili Vahtla