Police Are Searching for Danske’s Missing Ex-Estonia CEO

(Bloomberg) -- Police stepped up their search for the man who used to run the Danske Bank unit now at the center of a vast money-laundering scandal after he went missing from his home under suspicious circumstances.

Aivar Rehe, who was the chief executive officer of the Danish bank’s Estonian branch in 2006-2015, hasn’t been seen since leaving his home in greater Tallinn on Monday morning wearing a black jogging suit, Estonian police spokesman Kristjan Lukk confirmed by phone.

There’s reason to suspect Rehe’s life may be at risk, according to Lukk. He cited the fact that the former Danske executive had left home for a walk without bringing his mobile phone or his dog. Rehe’s family contacted local police after he didn’t return. Lukk said the search is, for now, still focused on the area around Rehe’s home.

“There’s quite a big patch of wooded area and we haven’t managed to check all of it,” Lukk said by phone on Tuesday morning. “We’ve had a couple of tips from the public, suggesting he was seen elsewhere in Tallinn, which we checked yesterday but which didn’t yield anything.” There’s currently no reason to suspect that Rehe has left Estonia, he said.

Danske admitted last year that much of $220 billion in non-resident flows that went through Estonia while Rehe was in charge was suspicious. But the 56-year-old has denied any knowledge of potential money laundering during his tenure. Rehe, known as a workaholic who came from a job at the Estonian Tax and Customs Board before joining Danske, has been questioned by prosecutors. He’s not known to be a suspect in the laundering investigations.

Valdo Poder, operations chief of the Northern Police Prefecture, told local news service Delfi that Rehe’s family has “given sufficient hints” suggesting he may have committed suicide. Rehe owns a license for a handgun but no guns, according to Poder. Police also aren’t ruling out kidnapping or the possibility that Rehe has been taken into a witness protection program, he said.

In an interview with local media in March, Rehe said that as the CEO of the Estonian branch, he naturally felt “responsible.” But he also said the unit had a “very normal daily” workflow. “Competent bodies inside and outside the bank did their job to the best of their knowledge,” he told Postimees.

Russian Money

Since exploding last year, Danske’s dirty-money saga has tainted a number of other banks. In the Nordic region, Swedbank is now being investigated amid allegations it may have handled over $100 billion in potentially suspicious transactions via its Baltic operations. The developments have painted a picture of widespread misconduct in which suspicious funds from Russia were channeled via Nordic banks into the West over a period of several years.

Danske, which was ordered by Estonia’s regulator to leave the country earlier this year, is now the target of numerous criminal investigations, including in Denmark, Estonia and the U.S. Several of its former executives in Denmark have had preliminary criminal charges brought against them, including former group CEO Thomas Borgen.

The laundering scandal has proved disastrous for Danske’s share price. Last year, it lost almost 50% in market value, and shareholders have had to swallow another 25% in declines so far in 2019. The bank is now facing class-action lawsuits from disgruntled investors.

Estonian police detained 10 former Danske employees in December and later expanded the list of suspects by two people, citing suspicious transactions linked to crimes committed in Azerbaijan and Georgia. Rehe was not among those detained or identified as a suspect.

Rehe started at the bank a year before it was bought by Danske in 2007, when it was still part of the Sampo group. His most recent position was as an adviser to Estonian lender Bigbank AS, a job he left in November, according to local newspaper Postimees, which cited Bigbank’s supervisory board Chairman Parvel Pruunsild. Pruunsild said Rehe’s exit had nothing to do with the Danske scandal.

In his March interview, Rehe said that the checks and controls in place while he was CEO were “sufficient.” He urged the public to await the outcome of multiple investigations into the Danske affair before drawing any conclusions. He also noted that anti-money laundering requirements at the time “were significantly different” from those that exist today.

To contact the reporter on this story: Ott Ummelas in Tallinn at oummelas@bloomberg.net

To contact the editors responsible for this story: Andrea Dudik at adudik@bloomberg.net, Tasneem Hanfi Brögger

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