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Danske Bank criticized over money laundering allegations

By GAN Integrity (Updated )

Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week we cover Danske Bank's money laundering case.  Read the full story and more news below:


Colombian companies probed over foreign bribery:

The Colombian Superintendency for Trade is investigating at least 12 local companies, including the agricultural company Vram Holding, suspected of bribing foreign officials in other countries. Reportedly, irregularities have been detected in Vram Holding’s Panamanian subsidiary's dealings with the Venezuelan government in connection with a USD 6 million contract to construct a baseball stadium in Venezuela. Corrupt payments were allegedly channeled through Panama and Hong Kong. If charged, Vram Holdings would be one of the first Colombia-based companies to be prosecuted for foreign bribery. AGM Desarrollos, another Colombia-based company is reportedly being probed by authorities in El Salvador in connection with a USD multi-million contract to provide public lighting services.

Danske Bank criticized over money laundering allegations:

The Danish Financial Supervisory Authority (FSA) uncovered what it described as ‘serious weaknesses in Danske Bank’s governance. The financial watchdog concluded that the bank faced higher compliance and reputational risk than previously assessed after conducting an investigation into the management and senior employees in connection with money-laundering allegations involving the bank’s Estonian branch. The investigation resulted in eight orders for reforms at Danske Bank and eight reprimands. Reportedly, a whistleblower report had brought the allegations to the attention of the bank already in 2013. The Bank admits that a deeper inquiry should have been conducted. It expects its internal investigation to be completed in September at the latest.

Regulators say they are not ready to monitor compliance with the GDPR:

The GDPR, Europe’s General Data Protection Regulation, and what is perceived as the biggest shake-up of data privacy laws so far, will enter into force on May 25th, yet regulators who will police compliance say they aren’t ready yet. Under the new regulations, companies must be able to provide European customers with a copy of their personal data, and under some circumstances delete it at their behest. Twenty-four national and regional watchdogs across the union are tasked with overseeing companies that collect large amounts of customer data, yet seventeen of which said that they lacked the necessary funding and power to fulfill their GDPR duties. Many watchdogs lack powers because their governments still haven’t updated their laws to include the new rules.


Top Chinese official sentenced to life:

Chinese state media reported that top Chinese official Sun Zhengcai was sentenced to life imprisonment for accepting bribes totaling USD 26 million. Sun was a former politburo member and party boss of the southwestern city of Chongqing, he was also perceived as a potential leader of the Communist Party of China (CCP) in 2022 and successor to President Xi Jinping. He pleaded guilty following a one-day trial last month. Sun is one of the highest officials to be toppled over corruption allegations since Xi initiated a sweeping anti-corruption campaign in China. A year ago, Sun and two other top officials - Bo Xilai and Zhou Yongkang - were accused of plotting to seize the CCP’s leadership and thereby the state. All three officials have been expelled from the party and are now serving prison sentences over corruption allegations. Chinese legislation was recently amended to allow President Xi to remain in power indefinitely.

Whistleblower protections expanded in Saudi Arabia:

King Salman of Saudi Arabia ordered the protection of employees who blow the whistle on financial and administrative corruption from the ‘violation of their privileges and rights’. The initiative is another push to crackdown on graft since spurring an anti-corruption campaign that saw dozens of royals and top businessmen investigated last year. The king also established specialized departments in the public prosecutor’s office to accelerate the investigation and prosecution of corruption cases. According to the public prosecutor, the anti-corruption campaign will work its way through lower-level offenses. Prince Alwaleed bin Talal was one of the detained in the corruption crackdown but released after reaching a settlement with authorities, nonetheless, 56 people remain in custody and could face trial.

Guatemalan military officials arrested on corruption charges

Three current and former army officials – a retired general, two colonels, and a reserve major – have been arrested by Guatemalan authorities on alleged corruption involving the Defense Ministry. Reportedly, the three officials are suspected of embezzlement, illicit association, and bribery including taking illegal commissions totaling more than USD 3 million through anomalous sales and in return for awarding military contracts.


New SEC investment protection tool launched:

Last week, the Securities and Exchange Commission (SEC) revealed the launch of Action Lookup for Individuals (SALI), an additional tool designed to help investors protect themselves against fraud and other misconduct. The tool allows investors to identify registered and unregistered individuals who have been parties to past SEC enforcement actions and against whom federal courts have entered judgments or the SEC has issued orders. SALI search results include parties from SEC actions filed between the first of October 2014 till the end of March 2018, the commission will, however, update the search feature periodically with new actions as well as those filed prior to October 2014.

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