One of the largest banks in Sweden, Swedbank, may have been used for extensive, systematic money laundering for nearly a decade. A total of USD 5.8 billion has been funneled between suspect accounts in Swedbank and Danske Bank in the Baltics. Of this, USD 26 million is linked to the Russian tax fraud that was uncovered by accountant Sergei Magnitsky.
For the past five months, Swedish television SVT has had access to a large quantity of classified documents detailing Danske Bank’s dealings with Swedbank. There were a large number of transactions between the banks’ clients between 2007 and 2015.
The analysis reveals that 50 of Swedbank’s customers that show several risk indicators of suspected money laundering have funneled a total of USD 5.8 billion through the bank.
“It’s a massive scandal. From what we’ve learned from SVT’s information, Swedbank’s accommodation of suspicious transactions comprised a significant part of the money laundering operations, in parity with Danske Bank,” says Louise Brown, corruption expert and chair of Transparency International’s Swedish chapter.
The investigation also shows transactions that can be linked to the most extensive tax fraud of its kind in Russian history, which was exposed by tax accountant Sergei Magnitsky, leading to his death. This fraud prompted the enactment of the Magnitsky Act in the United States in 2012, which imposed sanctions on a number of implicated Russian citizens.
He exposed the perpetrators
Bill Browder, financier
The fraud itself occurred in Russia in 2007, when a total of USD 230 million was paid out in the form of phony tax refunds. The money came from American financier Bill Browder’s investment fund Hermitage Capital Management, which had paid extensive profits tax to the Russian government.
Tax accountant Sergei Magnitsky was tasked with investigating the fraud. The perpetrators turned out to be not only career criminals, but also judges and police officers. But instead of arresting the implicated officials, the police arrested Magnitsky.
“He exposed the perpetrators and even personally testified against the police officers who were involved. But instead of the law enforcement authorities prosecuting the people who had stolen the Russian government’s money, they arrested Sergei Magnitsky,” Bill Browder tells SVT.
After some time in the infamous Butyrka prison, Magnitsky fell ill and was diagnosed with pancreatitis. After nearly a year in captivity, he was found dead in his cell on November 16, 2009. His body bore the marks of handcuffs and physical assault.
“After conducting a public investigation, we have two versions. He died because he was not given medical treatment, he was not treated in prison. Or maybe he died because he was deliberately killed,” says Zoya Svetova, who investigated the Magnitsky case in Moscow.
Now SVT reveals that some of the stolen money leads to one of Sweden’s largest banks: Swedbank. A total of USD 26 million from the tax fraud was funneled to about 50 accounts in Swedbank. The money was transferred via companies suspected of money laundering in the highly publicized scandal in Danske Bank.
“This is blood money, and anybody who thought they could just sort of profit a little bit and make a bit of money off of some bad guys has another thing coming,” Browder says.
Swedbank have zero tolerance on money laundering
Gabriel Francke Rodau, Head of Group communication
Swedbank’s Head of Group communication, Gabriel Francke Rodau, tells SVT that Swedbank actively monitors transactions, to reveal criminal activity. He confirms that Swedbank has identified suspected money laundering and reported the activities to the Swedish Financial Intelligence Unit.
“Swedbank have zero tolerance on money laundering and when we see signs, we act,” Rodau says.
Gabriel Francke Rodau did not want to answer the question if Swedbank has been aware that money stolen in the Magnitsky Case was funneled to about 50 accounts in Swedbank.
The CEO of Swedbank, Birgitte Bonnesen, has declined an interview by SVT.
Authorities in France, Denmark, the United States and elsewhere have already been investigating Danske Bank’s business in Estonia. The bank is suspected of extensive money laundering in Estonia in the years 2007–2015.
The full investigation “Swedbank and the money laundering“ is available in english on SVT Play.
This article is one of many about the suspected money laundering in Swedbank. Click on one of the chapters to continue reading. In Swedish only.
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Publicerat 20 februari 2019