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Be Safe – Protect your business from financial crime

Protecting your business against financial crime is a complex task. You need to remain vigilant, take precautions and have proper compliance procedures in place.

This site will guide you through the most common financial crime risks and explain what to be aware of to enable you to manage these risks.

Top tips for protecting your business from financial crime

! Be wary of unsolicited phone calls, emails and text messages. Educate all employees about being careful if they are asked to disclose confidential or personal information over the phone, by text message or email – even if a request seems genuine. Make sure that confidential information is shared only via safe and secure channels such as eBanking or District.Top tips for protecting your business from financial crime

! Consider investing in cyber insurance and online banking insurance. Protect your business with cyber insurance coverage, which will provide you with expert help if you become victim of a cyberattack. Make sure your insurance policies cover cyber theft/digital burglary committed via eBanking or District. You can protect your business and get good advice with Tryg’s cyber insurance and eBanking insurance.

! Conduct thorough due diligence checks of business relationships to mitigate risks. Ensure your business has a standard due diligence process in place for checking business relationships, such as those with vendors and customers. And make sure that the due diligence checks your business carries out on international trading partners is as thorough as the ones for domestic partners.

! Check that all the information stated in payment transfers is correct before you proceed. For cross-border transfers, remember also to check the SWIFT address, the currency code, details of the receiver and country. Never make a payment or transfer that you are uncertain about. Have payment processes in place to ensure secure invoicing and payments, and also make sure that your business has documented and approved lists for vendors and customers.

! Carry out a risk assessment. Be aware of the threat landscape and identify vulnerabilities and financial crime risks in your business. This brochure details a wide range of potential financial crime risk scenarios and explains how to mitigate the risks for your business.

! Have clear policies and educate employees about the threats of financial crime. Have clearly documented procedures for training and for processes that involve access to the business’s finances and confidential data so that every employee knows how to handle related requests securely.

Exposed to fraud? Read more about how to report fraud or contact us immediately if you suspect fraud.

Managing financial crime risks

  • Using corporate cards or digital payments

    Know how to keep your business protected in the following situations:

    • using a corporate card at a physical point of sale
    • making payments and transfers
    • making online purchases
    • spotting and unusual transaction
    • receiving emails, text messages and phone calls

    Find useful tips to help your business detect and avoid becoming a victim of financial crime

    Read more on our cards and digital payments site, where you can also find tips to protect your business from financial crime when employees use corporate cards or make digital payments and transfers. The site also explains the financial crime risks that your business is exposed to when making payments.

  • Doing business internationally

    Doing business internationally comes with additional financial crime risks, so you should be even more vigilant in order to protect your business

    • International partners can be tricky to verify. You should always ensure that you carry out a thorough due diligence review on potential and existing trading partners.
    • When buying, selling or transacting with international parties, be aware of any embargos and sanctions. These may change often, especially in unstable international political climates. It is your responsibility to avoid breaches of these international laws. Read more about sanctions here.
    • We might need to contact you with further questions when you transfer money abroad. This is to ensure that we are managing Danske Bank’s international risk exposure.
    • If your business uses District and you send a payment abroad as an express payment, you can follow the payment to the recipient with our track-and-trace function. The function enables you to see the status of the payment and check for yourself that it has arrived.
    • Doing business internationally increases fraud risks because face-to-face communication is often limited. So you should always take precautions when you deal with international partners.

  • Being online

    Managing cyber risks is important for every business. If cyber risks are not addressed properly, the business faces a risk of cyber criminals stealing confidential data and financial resources. At worst, the business may even face the risk of having to terminate activity as a result of a serious cyberattack.

     

    On our cybersecurity site, you can find more information on what you can do to ensure that your business’s cybersecurity is at its highest level.

  • Experiencing growth and managing internal processes

    Experiencing growth comes with financial crime risks. As well as following general advice, carrying out a risk assessment is critical to mitigating the financial crime risks your business faces – irrespective of its size.

    Carry out a risk assessment – some of the risk factors your assessment should cover

    • Growth – more employees and stakeholders means more people who can fail to detect signs of financial crime 
    • International exposure – international relations broaden your business’s exposure to new types of financial crime
    • Diversified profile and sectors – dealing with many industries makes your business more complex, and new types of financial crime can find their way through this complexity

    Tips for the types of processes and activities that should be covered by procedural documentation in your business

    • Due diligence processes – how to verify vendors and other business associates
    • Documented supplier overview – which business relationships have undergone a due diligence review and are known to be a trusted party
    • Clear procedures for payments and transfers. Read more on our card and digital payments site.
    • Implement a ‘four eyes’ control review. Consider who monitors whom in the business, and map their individual risk of overseeing red flags. (Segregation of duties when the business is growing)
    • To protect your business's data, limit employee’s access to ensure they only have access to data and systems that are necessary for their daily work
    • Increase knowledge of threats such as fraud types
    • IT security policies. Read more on our cybersecurity site.

    If the business faces several risk factors such as exponential growth, has international exposure and operates in highly regulated industries, the need for consulting services or investment in dedicated professionals for the areas should be considered. Small businesses face fewer risks and controlling processes in these businesses is often easier –large businesses need clearer documentation and stricter control of processes.

Financial crime risk types

  • Fraud comes in many forms and is a growing issue for many businesses. Fraudsters are becoming more sophisticated, and their use of social engineering makes scams harder to detect.

    At Danske Bank, we are continually developing our security systems to be prepared against various types of attacks. We monitor transactions to detect unusual activity, which helps alert us to suspected fraud activities. However, we encourage you to increase security within your business by being aware of the ways criminals are operating.

    On our fraud site, you can read more and see examples of trending fraud types, such as CEO fraud, beneficiary account change fraud, invoice fraud, vishing, and internal fraud, and you can learn what to be aware of to protect your business from becoming a victim of fraud attacks.

    • Fraud prevention policies to protect your business against fraud attacks
    • Secure invoicing and payment processes
    • Clear cybersecurity policy
    • Regular updates of policies and regular training of employees
    • Remember, fraud is not only an external threat but can happen inside your business too

  • Money laundering occurs when criminals attempt to conceal the origin of money obtained from criminal activities, such as drug trafficking or corruption, by converting it into a legitimate source.

    Money laundering happens in three phases. Placement: getting illegally earned money into the financial system. Layering: obscuring the origin of the money through a series of transactions. Integration: using the now-laundered money for legitimate purposes.

    Danske Bank works to ensure that neither the bank nor customers are used for money laundering purposes.

     

    Any business can unknowingly be part of a money laundering scheme if it for example accepts payments in money that has been earned through illegal activities. For this reason, it is important for your business to conduct due diligence checks and to question where the money of those you do business with originates.

    Legitimate businesses can be involved in this illegal process, so always follow these guidelines.

    • Be aware of your business partners’ purposes and intentions of doing business with you.
    • Understand where your business partners’ money originates from to ensure that your business does not unknowingly become a part of a money laundering scheme.
    • Have an authorised and documented vendor list.
    • Educate employees about money laundering risks and ensure that due diligence procedures are followed every time a financial transaction is made.

  • Sanctions and embargoes are political trade restrictions or prohibitions put in place against target countries, persons, transport vehicles and entities to curb unwanted behaviours or policies and to secure international security. Breaches of sanctions can have severe consequences.

    A current example of a sanction breach is Company X, which is a legitimate business, buying gas from a Russian state-owned gas supplier. Because the Russian gas supplier is on the EU sanctions list, the payment is stopped, the funds are frozen, and Company X is fined for not complying with current sanction rules.

    • Make sure that your business has a sanctions policy and stay up to date on changes in sanction restrictions.
    • Ensure that your trading partners are not breaking sanctions.
    • When carrying out due diligence checks on direct business associates, also check who they are doing business with. A business may indirectly become sanctioned through its affiliations with sanctioned parties (i.e. a sanctioned sub-vendor, using sanctioned transport vehicles, incorporating sanctioned parts into the final products (i.e. potash into fertiliser).
    • For more information about sanctions and risks to be aware of, please read this sanctions brochure.

    Danske Bank adheres to all UK, US, EU and UN sanctions. We may ask our customers questions about specific transactions to ensure that Danske Bank customers are not doing business with businesses or customers that are in violation of sanction restrictions.

  • Bribery often seems like a kind gesture to begin with. It might be an offer, a thoughtful gift or a promise in exchange for an action that turns out to be illegal or unethical. You and your business are exposed to bribery when you receive or someone offers, gives, solicits any item of value with the intent of influencing your actions.

    One example involves an employee of Company X, who offers the business’s shipping partner some money to speed up the shipping process and prioritise Company X’s shipment. The shipping partner accepts the offer because they have had a strong business relationship with the Company X employee for a long time.

    Both Company X and the shipping partner can be criminally charged because their actions are considered to be in violation with the law.

    • The bribe does not have to be given to become illegal – it is already illegal when you promise to give a bribe.
    • Both the person who offers a bribe and the person who demands it are considered criminally liable and can be prosecuted.
    • Be particularly alert to bribery.
    • People who currently are or have been closely associated with a prominent public function are known as Politically Exposed Persons (PEP), and PEPs are often at higher risk of being involved in bribery.
If you suspect that you have been a victim of fraud, you should contact us immediately on +45 70 123 456. Read more here on how you should react if you suspect fraud.  

How our responsibility as a bank affects you as a customer 

 

At Danske Bank, we are committed to protecting our customers, stakeholders and the societies in which we operate, and we take our obligation and responsibilities in preventing crime seriously.

Preventing financial crime includes looking for patterns and spotting things that are unusual. We take a three-step approach that enables us to know who our customers are, understand how our customers are using the bank, and detect and analyse any unusual use of the bank’s products and services.

Watch the video on this site to learn how the measures we employ at Danske Bank to fight financial crime can have implications for you as a customer.

Why are you asking for proof of my identity?

  • All our customers are subject to our due diligence process, which is a process that ensures that we know who our customers are. This process applies both to new customers and existing customers, even if they have been Danske Bank customers for many years.
  • Our customer due diligence process includes documenting the beneficial owner of a business, understanding how the business is structured and establishing how the business uses or is expected to use our products and services.
  • We carry out our due diligence checks on our customers on a regular basis to see if a customer’s needs or use of our products and services has changed. To ensure we can update all the information we need, the questions we ask are related to your business and the people connected to it.
  • Read more here about why we ask questions. 

Why are you asking about my transaction?

  • During a customer relationship, we monitor how our customers are using our products and services by means of transaction monitoring and screening.
  • By knowing our customers and monitoring their use of our products and services and then comparing this data against the customers’ expected use of the bank, we are able to spot any unusual activity.
  • Our systems and processes help alert us to when we need to investigate if customers have been victims of financial crime or if Danske Bank’s products and services are being misused for illegal activities. This protects both Danske Bank and our customers.
  • To understand your business model and help protect your business from financial crime, we may ask you to send us documentation of transactions on your business’s bank account that have been deemed to be not in line with its expected use of the bank.

Why is my transaction stopped?

  • We match the information we have about customers and their behaviour against data and information to validate and cross reference customer information and data.
  • To validate, compare and screen our own customer data, we use data from international sources, such as the EU and the UN, and from national registers.
  • Like all other financial institutions, Danske Bank monitors international sanction lists and screens customer information and behaviour against these lists.
Disclaimer: The content of the above is not, and should not be considered as, a substitute for legal advice.

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