The CEO of Denmark’s biggest bank resigned last week after an internal investigation found $235 billion in suspicious transactions at the bank’s branch in Estonia.
Thomas Borgen had led Danske Bank since 2013.
In a statement Wednesday he said, “It is clear that Danske Bank has failed to live up to its responsibility in the case of possible money laundering in Estonia. I deeply regret this.”
Borgen, 54, was the head of international banking including Estonia from 2009 and 2012.
Danske Bank said last week that Russian individuals and companies blacklisted by Moscow for suspected financial wrongdoing used the bank, along with companies registered in the UK and the British Virgin Islands.
On Thursday, EU Justice Commissioner Vera Jourova said Danske Bank is “the biggest scandal we have now in Europe.”
She’s meeting in October with finance ministers from Denmark, Estonia, and Finland to find out what went wrong at the bank and why regulators didn’t act sooner.
Danske Bank’s internal investigation started in late 2017. It was led by the Danish law firm, Bruun & Hjelje.
The report released Wednesday said $235 billion in suspicious transactions moved through accounts of about 15,000 non-resident customers between 2007 and 2015.
Nearly a quarter of the funds came from Russia, the report said. But the bank couldn’t identify who the money belonged to.
The report concluded that Danske Bank’s board and CEO hadn’t breached “their legal obligations towards the bank.”
Prosecutors in Denmark and Estonia are investigating criminal money laundering and Denmark’s financial regulator has also opened an investigation.
In the UK, the National Crime Agency said Friday said it is investigating the role at least one UK-registered company played in the suspicious transactions.
And in the United States, the DOJ, Treasury Department, and SEC are each examining Danske Bank, the Wall Street Journal said.
A whistleblower complained to the SEC more than two years ago, the WSJ said.
Copenhagen-based Danske Bank has about 20,000 employees and five million retail customers.
Richard L. Cassin is the publisher and editor of the FCPA Blog.