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.

1. Placement getting illegally earned money into the financial system.
2. Layering obscuring the origin of the money through a series of transactions.
3. 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. Be particularly alert to bribery and the reputational risks related to it.

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.
  
• People who currently are or have been closely associated with a prominent public function are known as Politically Exposed Persons (PEP), and PEPs and public officials are often at higher risk of being involved in bribery.
  
• Your liability can extend to third-party bribery under the UK Bribery Act (if applicable), emphasizing the need for comprehensive due diligence.