Danske Bank Money Laundering Allegations: Here's a Timeline

(Bloomberg) -- Danske Bank A/S offered until 2015 banking services at its Estonia branch to residents of other countries. Those operations have now embroiled the Copenhagen-based lender in the Nordic region’s biggest money laundering scandal.

Here’s a quick breakdown of the circumstances:

  • Many of these non-resident clients were from so-called high-risk countries, with weak defenses against money laundering, including Russia, Moldova and Azerbaijan
  • These customers are alleged to have used the branch for years to launder as much as 53 billion kroner ($8.3 billion)
  • Danske had indications of possible wrong-doing but only began terminating business with non-resident account holders after it got a report in 2013 by a whistle blower; it also began its own investigations
  • After reports in the media, the bank broadened its probe in September 2017 to examine customer transactions from 2007 and onward
  • In October, French authorities placed Danske under formal investigation; three months later, the authorities changed the bank’s status to “assisted witness,” meaning that Danske is part of the investigation but no longer under formal investigation
  • In April, Lars Morch, the executive responsible for international banking since 2012, resigned
  • A month later the Danish FSA ordered Danske to increase capital to absorb potential future losses by at least 5 billion kroner ($781 million); while saying returns in excess of 400 percent should have been a red flag, FSA Director General Jesper Berg has said evidence of wrong-doing on the bank’s part is too thin to seek a criminal investigation

Now, Denmark’s politicians are calling for tougher laws and bigger punishments, as the scandal stains the country’s reputation.

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