Estonia asked US for more in Danske fines than it received

Danske Bank's Tallinn office prior to its full closure in late 2019.
Danske Bank's Tallinn office prior to its full closure in late 2019. Source: Anna Aurelia Minev/ERR

According to prosecutor Maria Entsik, Estonia initially asked the U.S. for a larger share of Danske's fine than the promised €50 million, which is also an unprecedented amount.

Entsik said that there was a very good and close cooperation with the Americans – weekly meetings on how to help each other with the evidence gathered.

"Since last December, our prosecutor's office has been negotiating with our American counterparts to see if Estonia can participate in the fines," Entsik said.

She said that the original amount requested was higher than €50 million, but does not consider it appropriate to disclose it publicly.

"The Americans have a regulation that allows them to distribute the proceeds of crime they confiscate to those countries that have provided substantial assistance in their proceedings," she explained.

"The €50 million allocated to Estonia is actually an unprecedented amount. The Americans have usually given other countries in the order of a million dollars," Entsik said.

There are a couple of cases where the U.S. has shared even larger sums, Entsik recalled. "One of them was in Nigeria, the other one I think was in Malaysia, but in those cases it was what they call confiscated criminal proceeds that they were able to share. In this case, the criminal proceeds that were seized on U.S. soil came from victims in this other country, so it was essentially returned to the victims."

During the negotiations, the United States also set conditions on how Estonia must use the money. Entsik said that the money will be used mainly to strengthen the fight against economic crime and to improve the confiscation of the proceeds of crime.

"This year, under the auspices of the Ministry of the Interior, a project is being carried out to see how we can make the confiscation of the proceeds of crime more effective. Some very good proposals have come out of it, and it may be possible to finance them with the money from the Danske fine," Entsik said.

The details of who will handle the money are still being finalized, she said.

Asked why Denmark would receive more than $600 million while Estonia would receive $50 million, Entsik replied that the U.S. had not distributed any money to Denmark, but that the Kingdom of Denmark had pursued criminal proceedings against Danske's parent bank, and that the criminal proceedings had ended with the collection of the fine.

"At the same time, as the Americans had their own case pending against Danske Bank for fraudulent trading in American dollars, the United States countered the bank by reducing its claim by one less Danish fine. So the two billion awarded by the US included the €600 million claimed in the Danish case," Entsik explained.

According to Entsik, there is no claim in the criminal case against Danske Bank in Estonia. "The reason why the prosecutor's office is satisfied with this amount of money is that according to the criminal code, even in a situation where we would have been able to prosecute the bank as a legal entity here in Estonia, the maximum penalty we could have imposed on the bank at the time of the commission of this act was €16 million. The €50 million that the US has given us is many times more than what our own law would allow as a penalty," he said.

In mid-November, the money laundering case against Danske will begin in Estonia. Former employees of the Danske branch are accused of providing money laundering services to customers.

"I very much hope that we will have an effective criminal trial, so I am pleased to say that the judge is very decisive in this case. When we scheduled the hearings in September, it went very well," Entsik said.

Entsik confirmed that the prosecution will also use evidence gathered by the US in court. "The exchange of evidence has been mutual."

I believe that the part of the evidence that we were able to provide to our American counterparts was probably more important and more substantial. The evidence that we received from the Americans related to the offenses that were committed in America," she said.

Entsik added that she does not see that the hiring of Louis Freeh played any role in the investigative cooperation between Estonia and the United States, and the regulation under which the United States shares its confiscated criminal proceeds with other countries is effective only when cooperation was necessary.


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Editor: Barbara Oja, Kristina Kersa

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