Estonia orders Danske Bank to shut down following money laundering scandal
21 Feb 2019

The Financial Supervision Authority of Estonia (FSA) has ordered Danske Bank’s local unit to cease operating and finalise its affairs within eight months, citing its financial crime scandal which revealed that €200 billion was allegedly laundered through its system.

In a statement, the Estonian regulator said the bank would also have to consider the protection of the rights of its borrowers.

It is understood that as of the end of 2018, the bank had nearly 14,700 deposit customers and 12,300 loan customers.

“Danske Bank violated anti-money laundering regulations for many years by operating high-risk money-laundering clients to make suspicious transactions through the bank. In addition, Danske Bank misled the Estonian public authorities by providing them with inadequate information and thus actually hampered their activities,” the FSA explained.

“The Financial Supervision Authority, after publishing the reports, on-the-spot checks carried out at the bank and a thorough analysis of the information received from the Estonian Financial Intelligence Unit, has concluded that the bank must cease its activities in Estonia.”

The FSA also ordered Danske to submit an action plan for closing the branch in Estonia within 20 days.

In response to the development, Jesper Nielsen, Interim CEO of Danske Bank, said the bank would close down its remaining activities as ordered by the FSA and continue cooperating with it and other authorities.

“We acknowledge that the serious case of possible money laundering in Estonia has had a negative impact on Estonian society, and we acknowledge that the Estonian FSA, against this background, finds it best that Danske Bank discontinues its Estonian banking activities,” says Jesper Nielsen, Interim CEO of Danske Bank.

“We are sorry to be leaving Estonia against this background, but we understand the severity with which the Estonian FSA looks at this case, and we will close down our remaining activities as requested.”

In addition to Estonia, Danske Bank has caught the attention of other regulators over its scandal, which has roped in top banks in Europe and the US.

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One Response to “Estonia orders Danske Bank to shut down following money laundering scandal”
Simeon Petkov

Simeon Petkov February 20, 2019

A prudent approach by the FSA in Estonia. A big blow for Danske as such cases may follow. A reputation is hardest and longest to build for a bank and easiest to loose over a rogue case. It’s a big lesson to learn not only for Danske but for the industry and beyond.

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