Suspected money laundering at SEB
When the money laundering scandal at Danske Bank was revealed, the heads of two major Swedish banks assured the public that the non-resident customers who had laundered money did not have accounts with them.
One was Birgitte Bonnesen, CEO of Swedbank. The other was SEB’s CEO Johan Torgeby.
Now SVT’s Mission Investigate can reveal that 130 customers at SEB show clear warning signs of suspected money laundering – and that the bank was exposed to one of the best-known financial frauds in current time: ”The Magnitsky affair.”
In autumn 2018, the CEO of Danske Bank resigned amid plummeting share prices after the exposure of money laundering at the bank.
At the same time, SEB’s CEO Johan Torgeby went public to reassure the customers and the market: There is nothing to worry about regarding the bank’s operations in the Baltics, he said.
But SVT has found that 130 customers in the bank’s Baltic and Swedish branch demonstrate a high risk of suspected money laundering. This is the result of a joint investigation alongside the TT news agency, a group of journalists from Finnish broadcaster Yle and the OCCRP network, who analyzed SEB’s Baltic dealings in the years 2005–2017.
The reporters have gained access to a major leak regarding the Lithuanian bank Ukio and all of its transactions, as well as other documents regarding SEB.
Among the thousands of SEB customers, we identified 194 companies as suspicious “non-resident customers” - with accounts in the bank in both the Baltics and Sweden, but registered in other countries. It is this type of non-resident customers that have figured earlier in the Baltic money laundering scandal.
The first warning signs of the companies on the list is the owners. Graham Barrow is one of the world’s foremost experts on money laundering and he is well familiar with several of the Latvian names we found linked to the 194 companies.
It turns out that these men, along with several other names on the list of SEB’s customers, are among the most infamous front men in the world. These are people who own or operate a company on paper, allowing the true owner to remain anonymous.
“These are people who have either wittingly or unwittingly allowed their names to be used as the officers, shareholders, signatories for a massive number of companies,” says Graham Barrow.
The fact that SEB’s customers use front men is not the only red flag. The analysis also shows that more than 90 accountholders who are SEB customers, or the companies they do business with, are linked to previously known money laundering scandals.
This includes the famous “Magnitsky affair”, one of the world’s best-known financial frauds, in which both Swedbank and Danske Bank were involved.
Back in 2007, a group of criminals swindled the Russian treasury out of USD 230 million, tax money that had been paid in by the American investor Bill Browder.
Tax accountant Sergei Magnitsky was asked to investigate what had happened. When Magnitsky got close to the fraudsters, he was jailed, and later died under mysterious circumstances after a year behind bars.
In the fall of 2018 SEB’s CEO Johan Torgeby met the market and stated that the bank was not involved in the Baltic money laundering scandals.
”We feel very comfortable that what we have done from 2008 and up until today doesn’t have any real red flags that we need to worry about in the comparison.”
But the bank leaks show that 2008 is precisely when money began flowing out of companies linked to the Magnitsky affair, through accounts at SEB. By 2009 the sums corresponded to USD 72 million – three times as much as the dirty money found at Swedbank.
When summarizing the investigation of SEB’s customers in the period 2005–2017, the following stands clear:
• 150 of the companies are registered in high risk jurisdictions such as the British Virgin Islands, the UK, Belize and Panama.
• 87 of the companies share addresses – addresses that are familiar from earlier money laundering scandals.
• Essentially none of these customers has any visible operations in the country where they have the account.
• The 130 companies that shows the highest risk of suspected money laundering have funneled around 280 million dollars through SEB.
“We have said that we have not been systematically utilized for money laundering. When we see something we report it to the authorities. And we report a large number of transactions and customers,” says Gent Jansson, head of group compliance at SEB.
The bank says that 95 percent of the customers on the list are no longer among the bank’s accountholders. But the revelations about Danske Bank and Swedbank were never about the situation in 2019. In the past few years nearly all high-risk customers have been kicked out of the Nordic banks in the Baltics.
The money laundering scandal is about the customers and transactions the Nordic banks have approved over more than a decade, and above all the story the banks have told about it afterwards.
“They do have red flags. I would say that had they invited me to come in and do their investigation for them, that is not the statement that I would have produced, based on the information that you’ve shown me,” the expert Graham Barrow says.
Gent Jansson at SEB does not want to answer as to whether the CEO went too far in his 2018 statements.
“I don’t want to talk in terms of red flags, because we do in fact discover a number of cases of suspected money laundering, which we report to the authorities. Absolutely, we haven’t been as good at this historically as we are today. That’s a skill that we have continuously improved over time.”
Tuesday night, SEB published historic data of their non-resident customers from their Estonian branch.It shows that the transaction volume has decreased significantly since 2006. Still, the high risk customers in the category have transfered around 8 billion euros between 2008 and 2016 through the bank.
The full investigation “SEB and the money laundering“ is available in English on SVT Play.
Joachim Dyfvermark, Linda Larsson Kakuli & Axel Gordh Humlesjö
Reporters
Ella Hopf Berger & Frida Johanson
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Visualization, Web Production & technical development
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Published november 27th, 2019.