Internal fraud suspected at Nordbanken

Internal fraud suspected at Nordbanken An equity broker employed by Nordbanken has been arrested on suspicions of serious breach of faith and serious embezzlement. The suspicions are based on unauthorized short-selling of shares, which has continued for several months. The loss incurred by Nordbanken as a result of such proceedings is estimated at approximately SEK 290 million. The incident was revealed by the bank's internal control routines. No losses have been caused to the bank's clients in this connection. The fact that the amount could reach such proportions is explained in part by misleading information repeatedly provided by the broker to the securities back-office and partly by major fluctuations in share prices during the period in question. Group management takes the incident seriously. Although it was revealed by the bank's internal controls, it will lead to a critical review of applicable routines in order to make fraudulent manipulation of the bank's systems even more difficult and to detect irregular practices even faster. The bank has taken out overall insurance against various kinds of fraud. The insurance company has been informed of the incident. The financial fraud department of the police is investigating the matter. Further information: Jussi Laitinen, Executive Vice President, Markets, tel. (46-8) 614 78 32 Leif Larsson, Chief of Security, Sweden, (46-8) 614 95 68 ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/02/01/19990201BIT00370/bit0001.doc http://www.bit.se/bitonline/1999/02/01/19990201BIT00370/bit0002.pdf