Swedish Bank SEB Shares Tumble On Money Laundering Inquiry

Shares in Swedish bank SEB fell on Friday (Nov. 15) over news that it might soon be embroiled in a money-laundering scandal, which has also affected some of its peers in the region, according to a report in the Financial Times.

The bank said it had gotten some questions from the Swedish public broadcaster SVT, an organization that accused Swedbank of a similar offense. The scandal caused Swedbank’s shares to lose about 40 percent in value and the bank’s leadership was ousted.

The bank said it was contacted about “suspected money laundering in the Baltics” and that the information held by SVT’s investigative team “includes SEB.”

SEB’s largest shareholder is the investment arm of a Swedish family of industrialists known as the Wallenberg family. Although it received questions, SEB said it had “no further knowledge of the content of the (program).” The bank also said that if new information came out it, would “take action immediately.”

There have been a few scandals involving money laundering in the region in the past few years, perhaps most notably the one involving Danske Bank, where €200 billion was shuffled through an Estonian branch.

Swedbank was caught up as well, and was scrutinized for not being as forthcoming about the scandal as shareholders would have liked. SVT published documentation showing that €135 billion from “high-risk, non-resident” customers traveled the bank in Estonia over a decade.

SEB said it was putting the information out there “in order to be transparent.” The bank is the second largest  in Lithuania, Latvia and Estonia, behind Swedbank. Shares in SEB were down 14 percent on the news, which is almost the lowest point they’ve been in the past three years.

“For a long time, SEB has worked hard to ensure that it has adequate routines and processes to prevent money laundering,” the bank said in a statement. “However, just like any other bank, SEB cannot guarantee that it has not been used, nor that SEB will not be used. New challenges and risks constantly emerge. The development of SEB’s preventive work against money laundering therefore cannot and will not stop.”