Halister News

(Bloomberg) -- Danske, which was reported to police Monday for violating anti-money laundering rules, says it has cut the number of banks with which it does correspondent banking by half in the past 12 months to reduce risk of future breaches.

• Figure is now around 2,000, with a decision pending on whether to remain at that level, Flemming Pristed, the group’s general counsel, says in interview
• “Our Danish customers transfer money in and out of a lot of countries, so it’s all over the world, basically,” he says
• Bank has taken steps to comply with rules since getting FSA order in 2012 to improve anti-laundering systems, including expanding anti-money laundering unit to comprise 300 people, but “issue is that we haven’t been good enough at collecting quality data on our correspondent banks”
• Says FSA reported bank to police because agency doesn’t have the power to issue an administrative fine, unlike in Sweden, for example; Danske uncertain how large a fine it potentially faces since there’s no precedent in Denmark
• NOTE: March 21, Danske Bank Reported to Police for Anti- Money Laundering Failure Link
• NOTE: BIS consultative report from Oct. says banks’ traditionally broad networks are shrinking amid rising costs to comply with rules, “uncertainty about how far customer due diligence should go”
• NOTE: Last year, Nordea stepped up hiring of investigators, fraud specialists after Sweden’s FSA levied a 50 million- krona fine; Handelsbanken was fined 35 million kronor