Danish bank prevents staff from buying crypto

Getting your Trinity Audio player ready...

A Danish bank has won a court battle allowing it to bar its employees from purchasing cryptocurrencies. Nordea Bank had warned its employees against buying cryptos as they were too risky in 2018. An industry workers’ union filed a lawsuit against the bank over the directive, but as it turns out, a Danish court agrees with the bank.

The action by Nordea bank is as controversial as they come. First, it extends to the bank employees’ private lives and not just while on the job. What’s even more controversial is that the bank lets its employees invest in its own crypto-based products and financial instruments. The court ruling states:

The prohibition to invest in cryptocurrencies does not include investments in financial instruments manufactured by Nordea linked to cryptocurrencies. Further, the prohibition does not cover minor investments in cryptocurrency made by employees in product development roles who have a work-related reason to do so.

The employees can still buy cryptos, but they will have to seek permission from the bank’s compliance division. Those who already own cryptos will not be forced to sell them off. However, the bank encourages them to do so as ‘cryptos are too risky.’

Nordea Bank sent a memo in January 2018 to its staff members asking them to stay away from cryptos, citing lack of regulations and use in money laundering as some of the factors.

Denmark’s union for financial industry employees felt the bank was overstepping and filed a lawsuit in a Copenhagen court. In a statement, the leader of the union Kent Petersen said, “We filed suit because of the principle that everyone obviously has a private life and the right to act as a private individual. It was important for us and our members to establish what rights managers have. In this case, it was more far-reaching than what we find to be appropriate.”

The court has ruled against the union and now, Nordea Bank employees are legally barred from buying cryptos.

And while the bank has cited money laundering as one of the reasons to stay away from cryptos, it has also been involved in money laundering accusations itself. According to a Reuters report, the bank is alleged to have handled €700 million between 2005 and 2017. Citing leaked documents brought to light by a Finnish broadcaster, the report said a majority of the money was from companies registered in tax havens such as Belize and Panama.