AML in Sweden

Sweden is frequently viewed as a nation with low crime rates. Nevertheless, it grapples with its role as a regional financial hub and the associated hazards of money laundering due to domestic illegal activities, especially tax-related offenses. The absence of a unified national framework for coordinating Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) efforts further compounds the issue. The challenges of money laundering and terrorism financing are evident in Sweden, affecting even its sophisticated financial sector, which, like other advanced financial centers, is susceptible to these illicit activities. To address this vulnerability, Sweden has been compelled to establish an AML system. Despite this susceptibility, the reported incidents of money laundering have displayed fluctuations in recent years.

The Swedish Financial Supervisory Authority (SFSA), a public institution tasked with fostering stability and effectiveness in the financial system while ensuring adequate consumer protection, stands as a pivotal regulatory body. SFSA holds the authority to license, oversee, and monitor all enterprises functioning within the Swedish financial markets. This agency operates under the jurisdiction of the Ministry of Finance. Given the involvement of international criminal organizations in money laundering activities, multiple global entities engage in preventing such illicit practices. For instance, the Council of European Companies might impose restrictions on countries eligible for business engagements. Presently, the European Union has designated over 25 nations subject to varying degrees of trade sanctions.

Another noteworthy international body working to combat money laundering is the Financial Action Task Force (FATF). Sweden maintains its membership in the FATF and endeavors to adhere to the standards set forth by this organization. The FATF consistently assesses the specific risk factors associated with various regions in terms of money laundering.

The Swedish government places a high priority on combating money laundering and terrorist financing. This effort spans across the global, European Union, and national levels. In Sweden, numerous law enforcement and administrative entities, as well as significant portions of the private sector, bear Anti-Money Laundering (AML) responsibilities in this realm. In the endeavor to combat money laundering and terrorist financing, it’s imperative for businesses to assess the potential risks they might pose as conduits for these activities. This evaluation, termed a general risk assessment, forms the basis for establishing protocols and guidelines according to the identified threats.

An integral component of the work against money laundering and terrorist financing involves thoroughly understanding one’s customers—acquiring customer information before engaging in transactions or establishing business affiliations. The extent of measures taken to ensure customer awareness is determined by assessing the risk associated with each customer relationship. This assessment, referred to as the customer’s risk profile, plays a crucial role in these anti-money laundering and counter-terrorism efforts.

The primary objective of the Anti-Money Laundering Act is to thwart the utilization of companies for money laundering and the financing of terrorism. This legislation, enacted by August 2017, is designed to enact the directives of the European Union’s fourth Anti-Money Laundering (AML) directive. The Anti-Money Laundering regulations constitute an administrative framework that is applicable to specific sectors and diverse organizations, encompassing credit institutions, financial establishments, auditors, external accountants and tax advisors, legal professionals (under certain conditions), as well as providers of gambling services. In Sweden, the legal landscape addressing money laundering revolves around two key statutes: the Swedish Anti-Money Laundering and Terrorism Financing Law (Anti-Money Laundering Act) and the Criminal Code pertinent to Money Laundering Offenses.