News World Danske Bank boss quits over $234 billion money laundering scandal

Danske Bank boss quits over $234 billion money laundering scandal

Danske Bank’s chief executive Thomas Borgen resigned on Wednesday after an investigation revealed payments totalling 200 billion euros ($234 billion) through its Estonian branch, many of which the bank said were suspicious.

The Danish bank detailed compliance and control failings amid growing calls for a new European Union watchdog to crack down on financial crime after a series of money laundering scandals which have attracted the attention of U.S. authorities.

“Even though I was personally cleared from a legal point of view, I hold the ultimate responsibility. There is no doubt that we as an organization have failed in this situation and did not live up to expectations,” Borgen, who will stay on until a new CEO is appointed, told a press conference.

Borgen, 54, was in charge of Danske Bank’s international operations, including Estonia, between 2009 and 2012.

Danske Bank said in a summary of a report covering around 15,000 customers and 9.5 million payments between 2007 and 2015 that Borgen, Chairman Ole Andersen and the board “did not breach their legal obligations”.

Andersen said the bank had made an assessment of whether it violated U.S. laws, a key concern for shareholders, but declined to share its conclusion when asked at a press conference.

The Estonian non-resident portfolio included customers from Russia, Azerbaijan, Ukraine and other ex-Soviet states, the investigation, which began a year ago after the Berlingske newspaper revealed alleged misconduct at the branch, found.

Danske Bank, whose already battered shares fell by nearly 8 percent during morning trading, said some 6,200 customers had been examined so far and it expected “a significant part of the payments to be suspicious”.

Shares in Danske Bank had doubled in value from when Borgen took over as CEO in 2013 until July 2017, but have since lost more than a third as allegations of suspicious transactions increased and Denmark and Estonia began criminal investigations.

The bank said it had taken action including “warnings, dismissals, loss of bonus payments and reporting to the authorities” against current and former staff, as well as overhauling the systems which had contributed to the lapses.

In an indication of the potential costs such failings can have on a bank, Dutch bank ING agreed to pay 775 million euros ($900 million) this month after admitting criminals had been able to launder money through its accounts.

And earlier this year U.S. authorities accused Latvia’s ABLV of covering up money laundering, leading to the bank being denied U.S. dollar funding and its swift collapse.

While Danske does not have a banking license in the United States, banning U.S. correspondent banks from dealing with it would amount to shutting it out of the global financial network.

Top Stories

Indian woman, 25, involved in Andrei Popa murder, jailed

Larnaca District Court sentenced a 25-year-old Indian woman, resident of Larnaca, involved in the Andrei Popa case to 45 days in prison on Monday. The...

Night clubs request that they reopen with no dance floor and no bar services

The Pancyprian Association of Nightclubs (PA.SY.KE.D.) addresses a last appeal to the Minister of Health, the Minister of Finance and the Deputy Minister of...

Fifteen new coronavirus cases detected out of 2,709 tests

The Ministry of Health has announced that 15 new cases of the SARS-CoV-II virus were detected in Cyprus over the past 24 hours out...

Households and businesses affected by Medicane Ianos to be compensated

Prime Minister Kyriakos Mitsotakis promised the flood-stricken households and businesses of Karditsa that the government will stand at their side with "speed and determination",...

Workshop on forging synergies between industry and scientific research organised for Industry Week

A workshop was organised on Tuesday, in Nicosia, to discuss ways to forge synergies between industrial production and scientific research sectors, in a bid...

Taste

Souvlakia

Pork souvlaki: Put the meat and all the other ingredients in a bowl (not metal) and mix well. Cover the bowl and keep in...

Pastelli (Carob Toffee)

The nutritional sweet of Pastelli is made with the syrup of carob pods, produced by boiling their pulp until it forms a thick, sticky...

Meatballs with tomato and cumin

Place all meatball ingredients in a bowl and knead well with hands. Keep the mixture in the fridge for approximately 1 hour to thicken. In...

Crushed wheat pilaf with sausages and halloumi

Ingredients: 1 cup bulgar wheat ¼ of the cup vermicelli noodles or spaghetti, broken into small pieces 1 onion 2 sausages 1 cup tomato juice 1 vegetable stock cube 1/3 ts...