Scandinavian FSAs Summon Banks To Explain Their Accounts Against Panama Papers’ Allegations

By Staff Writer

Apr 06, 2016 04:56 AM EDT

Nordea Bank AB, the largest lender in Scandinavia, has been summoned by the Financial Supervisory Authority (FSA) of Sweden. FSA will meet with Nordea's management on Tuesday following the report by the International Consortium of Investigative Journalists.

During the meeting, Nordea management will have to explain its alleged role to assist wealthy clients in evading tax. FSA considers the 'Panama Papers' too seriously, informs Christer Furustedt, head of the FSA's supervision unit for large banks in Stockholm.

However, Nordea rejects the published allegations while claiming to follow all rules and regulations related to these issues. A statement furnished in the Nordea website claims for transparency in its tax advising policy. The bank also denies any role for aiding in tax evasion purposes and extends support only in paying taxes, reports Bloomberg.

Meanwhile, FSA has contacted authorities in Luxembourg seeking information on Nordea's alleged role in assisting clients setting up offshore accounts in tax heavens. Though setting up offshore accounts is not illegal in Sweden, it may flout the country's money laundering laws. The largest bank in Nordic region has been convicted for such breach last year while counting the maximum fine of 50 million crowns ($6.1 million) and handed a severe warning by the FSA, according to a report published in Reuters.

The Scandinavian largest bank has vowed to review all activities related to offshore accounts in Luxembourg. It has adopted proactive measures since 2009 to ensure reporting income on all customers' holdings and accounts to the tax authorities. However, the Nordea regrets not following these procedures even earlier, reports The Fiscal Times quoting Casper von Koskull, its CEO.

The bank advises vast majority of its customers not to use the offshore companies. It doesn't even accept structures non-transparent towards relevant tax authorities.

Scandinavia region is associated with low levels of corruption and high standards of transparency. Besides Nordea, the Luxembourg unit of Norway's largest lender, DNB ASA, has also been accused of helping around 40 customers establishing companies in the Seychelles from 2006-2010.

Norway's FSA will also ask the boards of the banks involved in the leaked documents to address their accounts brought to light by the media. It will also take up the issue with Luxembourg's financial regulator within the framework of European supervisory cooperation, informs Morten Baltzersen, the head of the regulator in Oslo.

The 11.5 million documents of the 'Panama Papers' furnish accusations against some Nordic banks for aiding their clients in abating tax. Nordic region is generally considered associated with low levels of corruptions and high standards of transparency. Recent spat of accusations has prompted authorities to investigate over the allegations published in the media. 

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