Danske Bank offers to donate gains from laundering scandal to good causes

Danske Bank, Denmark’s biggest bank, has said it will give profits earned from a reported money laundering scandal in Estonia to the benefit of society.

Danske Bank offers to donate gains from laundering scandal to good causes
Photo: Mads Joakim Rimer Rasmussen/Ritzau Scanpix

The bank made the announcement as it published its results for the first half of 2018 on Wednesday.

“Although it is still too early to conclude on the extent of suspicious transactions, it is clear the bank has not lived up to its own standards or the expectations of society in relation to preventing the affiliate in Estonia being potentially used for illegal activities,” the bank wrote in a statement.

“It is therefore the intention of the bank to place the net income from such transactions in the period 2007 to 2015 at the disposal of socially beneficial initiatives. That could include prevention of international financial crime,” the statement continued.

The bank added that it was still too early to say anything about the sums that may be involved.

The announcement comes after a comprehensive investigation covering a nine-year period and large quantities of data, documents and transactions.

Danske Bank has confirmed that it earned as much as 1.5 billion kroner from non-Estonian customers at its Estonian branch during the years 2007-2015.

No further information was given as to the proportion of that sum which may have come from criminal customers.

The head of Danske Bank’s compliance unit, the purpose of which is to ensure compliance with money laundering regulations, will be replaced, the bank also confirmed.

Financial media Finanswatch reported last week that Anders Meinert Jørgensen was to leave the position after a ‘turbulent period’ during which newspaper Berlingske lifted the lid on extensive possible money laundering through Danske Bank’s Estonian branch.

Jørgensen will be replaced by former Deutsche Bank executive Phillippe Vollot.

The Danish Financial Supervisory Authority has criticised the bank consequent to the report and asked it to reserve money for potential damages.

Denmark’s police unit for economic and international crime SØIK is now investigating the case, while Danske Bank has launched an internal investigation.

READ ALSO: Plot thickens in Danske Bank's money laundering scandal


Danish police drop money laundering case against Danske Bank directors

Denmark’s economic crime unit SØIK has dropped potential charges for money laundering against three leading former directors of Danske Bank, Denmark’s largest bank, but investigation of the bank itself continues.

Danish police drop money laundering case against Danske Bank directors
File photo: Jacob Gronholt-Pedersen/Reuters/Ritzau Scanpix

The three directors, Thomas Borgen, Henrik Ramlau-Hansen and Lars Stensgaard Mørch were investigated in relation to a scandal involving large-scale money laundering at the Estonian division of the bank.

Each of the three confirmed to newspaper Børsen that charges have been dropped.

In a written statement to media, SØIK said it had not uncovered “evidence that any individual has shown negligence to such an extent that it can be characterised as gross” and that the law had therefore not been broken.

“For an individual to be convicted under money laundering laws, they must have committed gross negligence. In this case we have conducted a vert comprehensive and thorough investigation with a number of investigative steps,” acting head of SØIK Per Flig also said in the statement.

The bank itself is still under investigation for possible breach of money laundering laws, however, Flig noted.

READ ALSO: US files lawsuit against scandal-hit Danske Bank

No individuals now remain under suspicion in the investigation, meaning SØIK has dropped cases against all leading bank executive who were suspected by police in March 2019.

Around 1,500 billion kroner from foreign customers flowed through the Estonian division of Danske Bank between 2007 and 2015, an investigation found.

A large proportion of that money is considered to be suspicious. The scandal resulted in Borgen’s resignation as CEO and the bank closed its Estonian branch in 2019.

READ ALSO: More on the Danske Bank money laundering scandal