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Regulator needs more time in probes of alleged money laundering at Swedbank, SEB

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Regulator needs more time in probes of alleged money laundering at Swedbank, SEB

Sweden's Financial Supervisory Authority pushed back the publication of the results of its probes into money laundering allegations against Swedbank AB (publ) and Skandinaviska Enskilda Banken AB in the Baltics, citing the "considerable amount of material" it is reviewing as part of the investigations.

The Swedish FSA said it now aims to publish its conclusion of the probes no later than the beginning of 2020. The Swedbank investigation was originally scheduled to be completed in October.

The Swedish regulator's probes, which focuses on the two banks' management and anti-money laundering controls in Estonia, Latvia and Lithuania from 2007 onward, are being conducted in cooperation with its counterparts in the three Baltic states. At the same time, Baltic financial regulators are looking into the compliance of the banks' subsidiaries with local regulations.

In February, Swedbank's then-CEO, Birgitte Bonnesen, admitted there was a "risk" that money laundering payments may have slipped through the lender's Baltic operations after Sweden's public broadcaster SVT alleged that $5.8 billion had been "funneled between suspect accounts" at the Stockholm-based lender and Danske Bank A/S, which itself is embroiled in a $230 billion money laundering scandal, between 2007 and 2015. Swedbank, which is also being investigated by U.S. authorities, later admitted to finding shortcomings in its internal probe into the money laundering allegations and said it was reviewing 50 billion transactions from more than 18 million customers between 2007 and March 2019.

In April, SEB CEO Johan Torgeby said the bank cannot guarantee that it is not being used for financial crime but that it is comfortable with the way it acted, following a report by Svenska Dagbladet saying the Swedish FSA had previously found "systematic deficiencies" in the bank's controls against money laundering.