Nordea Bank Faces Scrutiny Over Inadequate Data Collection on Sanctions Evasion
The Financial Supervisory Authority (Fiva) has issued a critical report highlighting significant shortcomings in Nordea Bank’s approach to collecting data essential for preventing customers from circumventing sanctions imposed on Russia.
According to the findings released on Friday, and made public following a request by the Finnish news agency STT, Nordea—Finland’s largest bank and a major player in the Nordic financial landscape—has fallen short in its due diligence regarding corporate clients deemed at high risk for evading economic restrictions.
The report, finalized in late October, closely examines the operations of Nordea’s Finnish division. It reveals a troubling lack of robust data collection procedures specifically aimed at identifying and mitigating risks related to Russian sanctions.
One of the report’s most alarming revelations is that Nordea has not maintained accurate, up-to-date records of its high-risk clients—specifically concerning their board members and owners. For years, the bank reportedly overlooked crucial updates from Finland’s Patent and Registration Office (PRH) regarding changes in company governance and ownership.
Moreover, Fiva found a general deficiency in Nordea’s information-gathering practices for corporate customers transacting in regions where the risk of sanctions evasion is significantly heightened.
This isn’t the first time Nordea has faced scrutiny. Last year, the bank settled a significant case with a U.S. financial regulator, paying $35 million. The investigation revealed failures on Nordea’s part to adequately monitor money-laundering activities between 2008 and 2019, which involved staggering transfers of tens of billions of euros linked to Russian and Azerbaijani funds.
As the regulator’s report underscores, the importance of diligent data collection and compliance remains paramount in the ongoing effort to uphold financial integrity in the face of evolving geopolitical dynamics.