Danske Bank’s Alleged Money Laundering has Uncovered New Funds

Marco Green
September 23, 2018

Bill Browder, a U.S. hedge fund manager who has been leading a crusade against corruption and money laundering by rich and powerful Russians, has claimed that Danske's Estonian branch was involved in the fraud uncovered by his lawyer Sergei Magnitsky, who was beaten to death in a Russia jail.

Danske Bank's money-laundering scandal spread to Britain on Friday as the National Crime Agency (NCA) said it is investigating the use of United Kingdom -registered companies.

Rasmus Jarlov, Denmark's business minister and the man in charge of overseeing financial legislation in Danske's home market, said the US$630 million estimate is based on an assumption that the bank's profits from transactions tainted by laundering amount to about 1.5 billion kroner.

The foundation will be "set up to support initiatives aimed at combating worldwide financial crime, including money laundering, also in Denmark and Estonia".

He's also pointed out that Danske's report is by no means the final word, as criminal investigations into the bank are ongoing in Denmark and Estonia.

Danske has admitted that about US$234 billion flowed through its unit in Estonia between 2007 and 2015, and says a large part of that needs to be treated as suspicious. This latest report revises that number upward, stating that approximately €200 billion was funneled through the exchange.

The investigation comprises of an examination into customers and transactions from 2007 to 2015, and a further examination questioning whether managers and employees, members of the executive board, or the board of directors had sufficiently fulfilled their obligations.

This is probably just the tip of the iceberg and many money laundering schemes remain to be uncovered.

The news is so big that Denmark's Prime Minister has released a statement.

"I'm shocked. The numbers that came out today are of an astronomical magnitude".

The targeted customers include residents of Russian Federation, the United Kingdom, and the British Virgin Islands.

In a sign of the growing pressure on Danske Bank, which already faces criminal inquiries in Denmark and Estonia, the chief executive of CARE Danmark said on Twitter that the Danish charity had chose to end its relationship with lender. Of these, Danske states that about 6,200 indicate the highest risk and that all these customers have been reported to the authorities. I deeply regret this.

Sampo, however, has not yet been found to be responsible for anything connected to the scandal, so it is possible that it could avoid the Nordic region's biggest money laundering case altogether.

Though cleared personally, CEO Thomas Borgen said he thought it was the "right thing for all parties" for him to resign. According to the bank's announcement, Borgen will continue in his position until a new CEO has been appointed.

The news was quickly picked up crypto news outlets like news.bitcoin.com, which tends to report on any illicit activity in the mainstream financial industry.

Other reports by Click Lancashire

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