The Laundry

The financial frontline of Russia's war in Ukraine runs through the offices of overworked sanctions officers at banks and financial institutes everywhere.

It's the bank's job to freeze the accounts and assets of sanctioned individuals, and the pressure is colossal. If you get it wrong or act too slowly, the impact on a bank's brand and bottom line will be felt for years to come.

So how is one of the largest Scandinavian banks keeping up with the ever-evolving sanctions measurements? 

We invited Amalie Korning Wedege, the head of sanctions and FCC focus areas at Danske Bank, to understand how they adapt, operationalise and keep up with the sanctions legislation. 

From this episode, you'll learn:

01:23 - 06:15: What has happened in the invasion's aftermath, and what is the current regulatory focus? 

06:16 - 08:29: How has Danske Bank effectively implemented, operationalised and adapted to the ever-changing sanctions?

08:30 - 10:49: Six important steps Danske Bank has implemented internally. 

10:52 - 13:31: What have been the most challenging parts?

13:31 - 16:31: Counterparty screening is a huge topic. How is Danske Bank ensuring its methods include counterparties and the "full picture"?

16:32 - 19:47: Examples and potential indicators of sanctions evasion.

19:49 - 21:27: Now, ten months after the Russian invasion, what have been the main learning points for Amalie?

21:28 - 22:50: Technology, has it been a friend or foe?

22:51 - 23:20: How has the "tone from the top" been like at Danske Bank?

23:21 - 24:47: What's next? And what trends does Amalie see coming in 2023?

24:48 - 26:26: Amalie's best tips to young professionals who are just starting out in compliance.

Tune in and enjoy!

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This week's special guest is Swedbank's former Chief Compliance Officer Viveka Strangert, also known through media as the "whistleblower" in the massive money laundering scandal.

Swedbank was fined 4 billion SEK (€389.8m) in 2020 by Sweden's financial watchdog for severe deficiencies in its AML processes and for withholding information from authorities investigating its role in the scandal, which also implicated Denmark's Danske Bank. 

Was these scandals a result of a cultural problem? We will try to discover that in our fascinating chat with Viveka.

From this episode, you'll learn:

00:59 - 04:15: What happened, and what was Viveka's involvement in the Swedbank case?

04:15 - 06:04: What it was like for Viveka to testify in court in such a big case.

06:16 - 10:05: How these high-profile scandals have changed the culture of compliance among Nordic banks.

10:06 - 14:52: Why the "tone from the top" is crucial to building a culture of compliance.

15:22 - 16:13: Are the banks and FIs still as naive today as in 2016 when the Swedbank scandal happened?

16:14 - 17:21: What advice would Viveka give young up-and-coming compliance officers?

17:45 - 19:03: Over-regulation and the negative consequences.

Tune in and enjoy!

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Billions are invested in KYC, but only 1% of money laundering is stopped. So why is that?

This week we have AML expert Louise Brown from Financial Compliance Group (FCG) in the studio to discuss this question and the following exciting topics:

– The extensive and recent money laundering scandal in Sweden, where 34 out of 43 exchange offices were linked to direct criminal activities, and it emerged that one single foreign exchange office in Stockholm had laundered millions in drug money and transferred funds to terrorist organizations.

– How criminals misuse the system and operate under the radar because government authorities are not permitted to share information due to local privacy legislation.

– Why a "culture of trust", lack of background controls, and very little practice in following up and monitoring make the Nordic countries an easy prey.

– And lastly, we deep dive into the "KYC bottlenecks" and look at how they can be removed.

1) Limited human resources.

2) Restricted data-sharing between government bodies

3) Poor data quality in the register of unique beneficiary owners managed by the Swedish Companies Registration Office. 

Tune in and enjoy!

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Now the popular crypto exchange FTX is bust, and crypto is plummeting. What happens next?

We've invited the biggest crypto sceptic of them all to The Laundry, and according to him, the future for crypto does not look very bright.

Liron Shapira, the self-proclaimed "Michael Burry of crypto" and the angel investor who turned a $10,000 investment in Coinbase into a $6 million profit, explains why he now thinks crypto is a big scam.

Tune in to this week's crypto special in The Laundry!

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Denne uken har vi besøk av leder i enheten for finansiell etterretning (EFE) i Økokrim, Sven Arild Damslora.

Jobben til teamet hans er å ta i mot rapporter fra rapporteringspliktige og bearbeide disse, for å så dele informasjonen med politi, tilsynsmyndigheter, og utenlandske tjenester. (Episode in 🇳🇴)

Sammen med Sven Arild ser vi blant annet på disse temaene.

• Hvordan Økokrim mener en god MT-melding på en bedriftkunde bør se ut.
• Hvordan man kan vurdere transaksjonsvarsler opp i mot trendene innenfor de forskjellige industrikodene (NACE).
• Hvilke metoder og data man kan berike transaksjonsmonitoreringen av bedrifter med.
• Hvorfor samarbeidet mellom revisor, regnskapsfører og banken bør styrkes på dette området.
• Underrapporteres det innenfor bedriftssegmentet?
• Hvorfor små bedrifter utgjør mesteparten av det volumet som meldes inn. Og hvorfor det ikke er flere meldinger på større selskaper og konsern.
• Finnes det et “kompetanse-gap” hos rapporteringspliktige når det kommer til overvåkning av bedriftskunder?
• Avviker kvaliteten på MT-meldinger på bedrifter fra det som kommer inn på privatpersoner?
• Og hva er på toppen av agendaen til EFE nå fremover?

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Cybercrime and financial crime are moving closer and closer together.

A growing number of cyber-attacks are believed to be the work of organised crime and combine cyber techniques, fraud and money laundering.

Despite this, most banks and financial services institutions continue to treat cybercrime and cybersecurity as one activity and AML, fraud and loss prevention as another.

As a result, each team will have its personnel, tools, and operating procedures. In some cases, teams are located in separate offices or even separate cities.

This siloed approach no longer works.

So, in this episode, we explore where the synergies are, what it means, and why it is important to close the gaps between cyber and financial crime.

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Banks and financial institutions at the forefront are moving into the next frontier of AML. They focus on four primary areas, which we look more closely at in this week's episode.

What are those four areas?

1: Synergies with other risk types. 

How Fraud, AML, and Cyber can benefit from each other and leverage the fact that these divisions utilize the same data and can feed each other with information.

2: Operational excellence

How banks can capture "gold-standard KYC" in the frontline to deliver better customer journeys, more precise services, and a better banking experience.

3: Collaboration across the industry

Industry players want to collaborate, understand, learn, and jointly develop new ways to combat risk through data sharing. 

4: Higher efficiency

False positives cause tremendous requirements in terms of people and time spent on investigation. So how can banks ensure that their teams spend time where it matters? Catching the big fish?

Tune in to this week's episode, where we also have AML-expert Magnus Johannesen back in the studio!

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How can Compliance Officers deliver more human-centric programs? Traditional compliance programs often do not think about behavioral drivers. Instead, traditional approaches think about how we would like people to behave rather than how they are likely to behave. That's the theory behind Human Risk, a London-based compliance firm run by this week's guest, Christian Hunt. 

Christian has over 25 years of experience in financial services. And he brings a unique perspective to the compliance field, having both been a regulator with a subsidiary of the Bank of England and a Risk & Compliance Officer at UBS.

Tune in and learn why you should bring behavioral science to your compliance program.

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