FRANKFURT — If Russian oligarchs try to launder their money to circumvent sanctions, they won’t have any luck in Estonia, according to the country’s central bank chief.
Both Estonia’s banks and authorities have pulled out all stops to weed out illicit money after the country’s reputation was tainted by scandal, Madis Müller told POLITICO.
“I think everyone now is just extra careful in managing the anti-money laundering risks,” Müller said, citing the “bad publicity” associated with its banking practices.
Estonia had long struggled on the money laundering front, but it was especially damaged by the Danske Bank affair, the largest such scandal ever in Europe. From 2007 to 2016, Denmark’s biggest bank failed to spot €200 billion in illicit funds — much of which stemmed from Russia — funneled through its branch in Estonia.
The scandal is still reverberating today, Müller said.
“Resources to deal with [anti-money laundering] risks have been substantially beefed up at commercial banks, the [financial supervisor] and the Financial Intelligence Unit,” he said, adding that this effort extends to cooperation with the Nordic supervisor authorities, which aren’t part of the Single Supervisory Mechanism (SSM.)
“One can safely say that the problems with money laundering in the Estonian banking sector are history now,” he added.
At this point, Müller is more concerned about Russians turning to the global market for crypto assets, as a way to both launder money and avoid sanctions.