Danske Bank Charged by Police for Violating Market Abuse Law

(Bloomberg) -- Danske Bank A/S has been charged by Danish police for allegedly violating rules intended to protect investors from market manipulation.

Denmark’s biggest bank, which is separately being investigated in the U.S. and Europe amid an ongoing money-laundering case, says it received notice of preliminary charges from the Danish State Prosecutor for Serious Economic and International Crime, or SOIK. The case relates to two potential violations of market abuse regulations, according to an emailed statement on Friday.

Police are pursuing the case after Denmark’s Financial Supervisory Authority raised its concerns last year. The watchdog alleges that Danske routinely entered into agreements to buy or sell financial instruments without any change in ownership of the securities.

Danske’s chief compliance officer, Philippe Vollot, said the bank is cooperating with police to resolve the case, “which we take very seriously.” He also acknowledged that Danske “did not have adequate market monitoring in place,” but that its own assessment doesn’t indicate there was any “intentional wrongdoing or any harm to customers or market participants.” The bank has made “significant investments” since 2019 to avoid a repeat, he said.

That said, Danske expects the case to drag on for “quite a long time,” its head of investor relations, Claus Jensen, said during an analyst call on Friday.

“When it comes to a potential fine, that’s too early to speculate,” he said. “And we do not really have any history that we can lean up against when it comes to fines for these types of cases.”

The charges mark the latest in a string of cases that have tainted Danske’s reputation. Aside from its vast money-laundering affair, which may result in substantial fines, the bank was also reported to police for providing bad advice to retail investors. And Danske drew political condemnation in 2020 for charging low-income borrowers too much on their loans over a period of several years.

The scandals have cost multiple Danske executives their jobs. Former CEO Thomas Borgen, who was fired in late 2018, has since had criminal charges against him dropped. His replacement, Chris Vogelzang, stepped down in April after a Dutch money-laundering investigation implicated the former ABN Amro Bank NV executive.

Danske’s current CEO, Carsten Egeriis, is a former head of risk management.

Story Link: Danske Preliminarily Charged for Violating Market Abuse Laws

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