Denmark’s largest bank, Danske Bank, is to pay 3.5 billion kroner (€470 million) in fines to end prosecution in a massive money laundering scandal involving its Estonian subsidiary.
This was announced on Wednesday by the Danish financial watchdog.
The fine, which comes a day after Danske Bank settled a case in the US for $2 billion, “is the largest ever imposed in Denmark in the area of money laundering,” prosecutor Jens-Christian Bülow was quoted in the statement as saying.
“It is extremely serious that a bank does not have the necessary corporate governance and internal controls in the area of money laundering and that it does not react correctly and quickly to warnings about possible money laundering,” he stressed.
The banking institution, which had acknowledged flaws that led to the laundering between 2007 and 2015 of around €200 billion through its Estonian subsidiary, has since invested heavily to comply with the legislation in force in this area.
In 2018, an internal audit detailed a “series of major deficiencies” in the bank’s governance and control systems and its chief executive Thomas Borgen resigned.
Borgen was recently acquitted in first instance by a group of international investors.
€168 million seized from Estonian branch
In addition to the fine, the Danish state confiscated 1.25 billion kroner (€168 million) in profits from transactions in the Estonian subsidiary, now closed, as well as those in the other Baltic countries and the bank's Russian subsidiary.
In the US, Danske Bank pleaded guilty and agreed on Tuesday to pay $2 billion to resolve fraud investigations against US banks. The provision of this sum was announced at the end of October when it published its third quarter results.
