TITLE: Denmark's Financial Supervisory Authority Reports Compliance Function Improvements at Money and Mortgage Credit Institutions
BODY:
On April 21, 2026, Denmark's Financial Supervisory Authority (Finanstilsynet) published findings from inspections of money and mortgage credit institutions conducted between 2023 and 2026, detailing compliance function deficiencies and subsequent improvements.
The inspections, which covered large, medium-sized, and smaller institutions, assessed how compliance functions discharged their responsibilities under sections 17 and 23 of the Management and Governance Regulation for Money Institutions (ledelsesbekendtgørelsen), alongside other applicable legislation. The compliance function is responsible for monitoring institutional adherence to legislation, market standards, and internal rules, thereby mitigating risks for both the institution and its customers.
The Financial Supervisory Authority identified systemic compliance gaps across institutions, including: insufficient business procedures for compliance function operations; inadequate attention to sector-specific compliance rules; incomplete compliance risk assessment across all material areas; failure to verify whether business units complied with policies in practice; insufficient oversight of business unit compliance risk assessments; unclear delineation of responsibilities between compliance and risk management functions; inadequate follow-up on identified deficiencies; compromised compliance function independence; insufficient resources and expertise; and inadequate reporting to boards and management.
The Financial Supervisory Authority issued mandatory orders addressing these deficiencies, which have resulted in improvements at the inspected institutions. The authority has published a comprehensive report detailing these observations to assist institutions in strengthening their compliance frameworks going forward. The report is available on the Financial Supervisory Authority's website, with inquiries directed to Lars Stage, Deputy Director, at ls@ftnet.dk or +45 33 55 83 34.