24 Sep 2018
Danske Bank’s (DANSKE.CO) money laundering scandal spread on Friday to Britain where the National Crime Agency (NCA) said it is investigating the use of UK-registered companies.
Concern about the extent of possible money laundering involving Danske Bank’s Estonian branch is mounting and European Union Competition Commissioner Margrethe Vestager joined a growing chorus of calls for a clampdown on the billions of euros alleged to have been “washed” through several European banks.
“This is a giga scandal,” Vestager said, as Danske Bank’s already battered shares fell a further 3.9 percent.
Britain’s NCA said it was “aware of the use of UK registered companies in this case and has related on-going operational activity”, adding that the threat posed by the use of UK-registered companies for money laundering was “widely recognised” and that Britain was working to restrict it.
British and Russian entities dominate a list of accounts used to make 200 billion euros (180 billion pounds) in payments through Danske Bank’s Estonian branch between 2007 and 2015, many of which the bank said this week are suspicious.
By 2013, the number of UK-registered customers in its non-resident portfolio topped 1,000, Danske Bank’s report revealed, ahead of Russia, the British Virgin Islands and Finland.
“We are following and analysing the situation closely…” Samu Kurri, head of financial analysis and operational risks at Finland’s Financial Supervisory Authority told Reuters.
Investor concerns over the potential penalties Danske Bank could face have increased, with particular focus on what action U.S. authorities might take after an investigation commissioned by the bank exposed control and compliance failings.
The bank faces Danish and Estonian criminal inquiries following complaints filed by U.S. fund manager Bill Browder, who is campaigning against corruption in Russia.
So far the United States has not said whether it is investigating and while Danske Bank Chairman Ole Andersen said that the lender had made an assessment of whether it violated any U.S. laws, he declined to share its conclusion of this.
– By Teis Jensen, Pamela Barbaglia, Reuters, 21 September 2018.
Link to Reuters.
You can claim CPD minutes for this content, by signing up to our CPD WalletFREE CPD Wallet