According to the Financial Times, an independent investigation has found that up to $30 billion were moved through the Estonian branch of Danske Bank within just a single year out of Russia and other countries in the former Soviet Union.
The paper got hold of a draft report commissioned by Danske Bank and put together by consultants Promontory Financial. Its conclusions beg the question how much the bank's management actually knew given the sheer amount of money that passed through the comparably small Estonian branch, the paper wrote.
The transactions in question took place between 2007 and 2015. In terms of the Estonian branch's holdings, 2013 was the peak year, when the bank held almost $30 billion in foreign clients' assets. The same year saw some 80,000 transactions as well.
The Financial Times quotes a source close to the investigation as saying that given the small size of the branch, such a sum is "shocking". Such amounts of money couldn't be moved without there being questions.
Not all of the branch's transactions were questionable. But it is the bank's duty to make sure for its own sake as well as to meet the requirements of the financial watchdog that it isn't involved in money laundering, and that its checks are strong enough to detect dirty money.
Danske's chairman of the board, Ole Andresen, said that the bank is taking the issue very seriously, which was one of the reasons for the new report: "We are dedicated to getting the full picture, and I believe that it is in the interest of everyone that conclusions are based on confirmed facts, not on fragments of information taken out of context."
Andresen added that they are in the final phase of putting together the report, but that it is already clear that there are "big questions" connected to the Estonian branch's holdings at the time, and that they are bigger than previously assumed.
So far the assumption was that some $3.9 billion in dubious assets moved through the Estonian branch of Danske Bank over a period of nine years. Investor and Kremlin critic Bill Browder as well as Danish paper Berlingske have said that the actual sum that moved though the bank was much higher and more likely to have been some $8.3 billion. Danske eventually conceded that the final sum might be "several times" higher.
Norwegian banker Thomas Borgen, currently Danske's CEO, was responsible for the bank's international business between 2009 and 2012, including that of the Estonian branch. The evidence available at this point begs the question whether or not Borgen was aware of the sums involved, and what he did to investigate.
Promontory Financial write in their report that after 2013, the sums began to shrink, and suddenly dropped when Estonia's Financial Supervision Authority showed interest in the issue, who in 2014 found that Danske's Estonian branch had systematically violated anti money-laundering regulations and demanded that Danske limit the services it provided to foreign clients.
Danske Bank is expected to publish two reports in September, one about the details of the dubious transactions in the case, and another concerning supervision.
Editor: Dario Cavegn
Source: Financial Times