Estonia's Financial Supervisory Authority (FSA) has suggested its Danish counterpart make public all documents related to the Danske Bank money laundering case. The request follows reports of something of a communication breakdown between the two bodies during their original investigations into the branch, starting in 2013.
Around €200 billion in potentially illicit funds, mostly of Russian Federation origin, is thought to have passed through Danske Estonia over the period 2007-2015. On Tuesday, the FSA announced that Danske would have to cease all activities in Estonia within eight months; in practice Danske, which is also pulling out of Latvia, Lithuania and the Russian Federation, had stopped taking on private clients and non-resident clients in 2015, precisely because of FSA suspicions about activities there.
The FSA had added on Tuesday that it felt the Danish FSA had not taken a hard enough line with the bank, which is heaquartered in Copenhagen.
The Estonian authority has noted that, according to a Danish FSA press release, that country's finance ministry had sent two documents to its parliament concerning relations with the Estonian FSA in the light of the Danske scandal.
The Estonian FSA says only two letters have been published by Denmark so far, and that these have been misleading; to redress what it sees as this imbalance, the Estonian FSA has made public the major points in correspondence with the Danish authority on the Danske issue.
First, the Estonian regulator says that a letter sent by the Danish supervisory authority in April 2013 stated that the latter was prepared to contribute to the Estonian authorities investigation of Danske Estonia. The following February, the Estonian FSA informed its Danish counterpart of its plans to conduct preliminary on-the-spot investigations, and requested feedback on this plan from Denmark.
First letter responded to, second not
A few days later, on 20 February 2014, the Danish FSA sent a letter to the Estonian authority thanking it for the information provided and expressing the hope of getting an overview of the planned on-the-spot investigateion's results.
In April 2014, the Estonian FSA wrote another letter to the Danish authority, informing it about another planned inspection of Danske Estonia, again requesting feedback on the idea.
However, no such feedback was received, according to extant records at the Estonian FSA. Danske employee interviews also point to a lack of Danish FSA feedback on this second letter concerning on-the-spot investigations.
The second investigation went ahead, leading to a 300+ page report in December 2014, and in February 2015 the Estonian FSA outlined the results of the inspection as required.
Consequently, the Estonian FSA is now asking the Danish FSA to consider both agencies disclosing, to the full extent permitted by law, all documentation relating to Danske, including on-the-spot insepection reports and correspondence between the two authorities, down to 2015.
The Estonian FSA has also noted that Danish authorities had previously made public correspondence between the two bodies, without its consent.
Editor: Andrew Whyte