IMF's report on money laundering risks in the Nordic-Baltic region published

Published 04-09-2023

On behalf of the Nordic and Baltic countries, the IMF has analyzed money laundering risks in the Nordic-Baltic region. Based on this, the IMF makes recommendations to the countries on how efforts to combat money laundering can be strengthened, for example through increased cooperation between the countries.

Denmark is pleased to announce the publication of the IMF Regional Nordic-Baltic Technical Assistance Report on “Financial Flows Analysis, AML/CFT Supervision, and Financial Stability”.

In a first-of-its-kind regional technical assistance project on Anti-Money Laundering. Denmark partnered with the IMF, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden to continue enhancing the effectiveness of the AML/CFT frameworks at the country and regional level. The IMF used machine learning technology, on a country specific and regional level, to better understand cross-border money laundering risks, analyzed the ability of AML/CFT supervisory tools to respond to these risks and developed recommendations to increase their effectiveness, and explored quantifying the impact of money laundering shocks on financial stability. Read the report here. 

The Report notes that continuous efforts to strengthen AML/CFT frameworks is a clear priority in the Region and that coordinated action and innovative solutions are key in keeping pace with evolving risks stemming from money laundering. More specifically, it recommends ongoing monitoring of cross-border flows, regional information exchange on macro-trends, and better identification of countries with potential specific money laundering risks to the Nordic-Baltic Region. To bolster AML/CFT risk-based supervision, the Report calls for increased collection of cross-border data and complementary investments in advanced data analytic tools, as well as coordinated supervisory action for the highest risk banks. Finally, it recommends continued analysis of the impact of AML breaches on financial stability to fortify the financial system against money laundering shocks. 

A strong anti-money laundering supervision is essential for preserving the integrity and stability of the financial system in Denmark. At the same time, cross-border cooperation is of paramount significance due to the global nature of financial transactions and money laundering activities. The regional report from the IMF is a useful contribution to the Nordic-Baltic cooperation in fighting money laundering and the financing of terrorism in the region. It supplements the ongoing work at the European level to increase cooperation on countering money laundering and the financing of terrorism.

The Danish authorities welcome the recommendations of the IMF’s report which are to a large extent in alignment with ongoing work of the authorities.

According to the report, Danish authorities are continuously improving their efforts in this important area of financial oversight, and significant amount of resources are allocated to the prevention of money laundering and terrorist financing both within the private sector as well as within Danish authorities.

Cooperation between authorities, both nationally and across borders, are also under continuous improvement. This is of great importance for the fight against money laundering and terrorist financing, and the DFSA is working to continue, enhance and strengthen this cooperation. 

Money laundering oversight at the DFSA benefits from a comprehensive database and analysis systems that are based on regular reports from obliged entities that enable the identifying money laundering risk stemming from individual companies, business models and transactions. The DFSA is continuously improving the system, not least by the integration of qualitative information from open and internal sources through the use of new technology on top of quantitative data that the authorities collect already. This enhances the insight that supports the quality and effectiveness of the DFSA's supervision.

Last updated 04-09-2023