Per the DFS Press Release:
· Following “the 2016 Panama Papers leak of millions of Mossack Fonseca law firm records . . . [t]he Department subsequently launched reviews of licensees connected to the law firm, including Swedbank.”
· “Over the course of two years, DFS issued two information requests to Swedbank, seeking details about the Bank’s relationships with Mossack Fonseca and related banks, institutions, and individuals. Subsequently, DFS found that the Bank withheld critical information responsive to these requests.”
· “Additionally, Swedbank continued to obscure information in response to DFS’s follow-up request. The Department found that, in communications with DFS, Swedbank created a false impression that it would review its Baltic subsidiaries for responsive information. The Department subsequently found that the Bank intentionally excluded its Baltic subsidiaries from its production to the Department to avoid revealing Swedbank’s numerous connections to Mossack Fonseca and failed to disclose adverse findings by European regulators.”
Noteworthy language from the DFS Consent Order:
· “New York law requires regulated institutions to be fully transparent in their dealings with the Department. This obligation applies to all of a licensee’s interactions with the Department—from its communications with examiners to responses provided during civil investigations. A licensee’s access to the New York financial market is predicated on the licensee meeting certain obligations, including responding to the Department’s requests completely, accurately, and truthfully.”
· “Licensees that structure their business lines and operations through unified, cross-border systems must report the full scope of their activities to the Department when requested to do so—not just those of their New York branch.”
· “The Department regulates more than 3,200 financial institutions with nearly $10 trillion in assets, including 120 foreign banks and 15 Global Systemically Important Banks, and must be able to rely on the information provided by institutions operating in New York. The regulatory obligations of licensees are a necessary counterpart to the benefits of a New York presence, ensuring that institutions operate in a safe and sound manner, protect consumers, and guard the financial system against fraud, illicit activity, and broader market instability.”