The fund is accusing Denmark’s largest bank of defrauding investors by failing to assess €200bn (US$221 bn) of suspicious payments while overstating its legitimate profitability and ability to thwart misconduct. Â
“Though a whistleblower brought the illegal Estonian money laundering to the Company’s senior executives’ attention in December 2013 … Danske Bank was intentionally less than forthcoming with the Danish financial regulators,” said the complaint filed in the U.S. District Court in Manhattan on Wednesday.
The defendants include former chief executive Thomas Borgen, former chairman Ole Andersen, and two former finance officers. Borgen and Anderson both left the bank last year. Â
The scandal first emerged in March 2017 when leaked data showed the bank was used to hide billions of dollars for international criminal networks in Russia, Azerbaijan and Moldova.
Executives were implicated in September 2018 when a draft report commissioned by the bank and leaked to the Financial Times showed that Danske’s leadership was made aware of the issue yet refused to scale back its Estonian non-residency business.
A total of €200bn of suspicious payments passed through the bank’s Estonian branch between 2007 and 2015. The European Commission described it as Europe’s “biggest scandal.”
The Danish public prosecutor launched criminal charges in November 2018 for serious economic and international crime under the country’s anti-money-laundering act. A month later Estonian prosecutors arrested 10 former employees on suspicion of knowingly enabling money laundering.
It was part of another concerning week for Danske as France placed the bank back under investigation on Friday. It came a day after a prominent campaigner against Russian corruption claimed Danske lied to French authorities regarding an alleged $230m Russian tax fraud.
The Organised Crime and Corruption Reporting Project named Danske Bank 2018's Corrupt Actor of the Year.
