UPDATE 1-Danske beefs up anti-money laundering measures in Norway after inspection

(Adds details about inspection, quote, background)

COPENHAGEN, July 22 (Reuters) - Danske Bank will strengthen anti-money laundering efforts in its Norwegian unit after the country’s financial watchdog found it had failed to comply with Norwegian regulations on several points.

During a routine inspection in September 2019, the Financial Supervisory Authority (FSA) uncovered a series of shortcomings in Danske’s Norwegian organisation, which it found to be too complex and overly reliant on the Copenhagen head office.

“It is FSA’s view that there is no comprehensive management of the unit’s anti-money laundering work,” the regulator said in a partly redacted 21-page letter to the bank.

Among the breaches, Danske has been too slow to investigate suspicious transactions and clients, and did not sufficiently adapt its monitoring to Norwegian legal requirements, the FSA said.

Danske Bank in a separate statement said it would implement 35 measures to beef up compliance, of which 21 have been completed. “In recent years, we have taken many initiatives to improve our efforts against economic crime, but unfortunately we have not succeeded completely in adapting to the new legislation in Norway,” the country director for Norway, Trond Mellingsaeter, said.

The measures would affect a number of both corporate and private clients, Mellingsaeter said, as the demands for information and documentation about the client would increase.

“We have set aside significant resources to operationalize the full range of measures,” he said.

Danske Bank is still reeling from a 2017 money-laundering scandal in its Estonian business, which led to thousands of clients jumping ship and put the bank under investigation by authorities in several countries.

Reporting by Nikolaj Skydsgaard in Copenhagen; Additional reporting by Terje Solsvik and Nerijus Adomaitis in Oslo Editing by Chris Reese and Leslie Adler