Denmark’s Danske Bank Pleads Guilty to Financial Fraud, Forfeits $2 Billion

Major Blow to Denmark’s Largest Bank

Danske Bank A/S, Denmark’s largest bank, has pleaded guilty to conspiring to commit bank fraud and agreed to forfeit $2 billion in a resolution with US authorities. This is a significant blow to the bank, which has faced numerous investigations and fines in recent years.

Background of the Fraudulent Activities

According to court documents, between 2008 and 2016, Danske Bank Estonia, a branch of the bank in Estonia, processed $160 billion through US banks on behalf of non-resident customers, including those from Russia. The bank’s employees conspired with these customers to shield the true nature of their transactions, using shell companies that obscured actual ownership of the funds.

US Authorities’ Accusations

US authorities accused Danske Bank of deliberately disregarding US law and facilitating the laundering of criminal and suspicious proceeds through the United States. The bank’s guilty plea marks a significant victory for US authorities in their efforts to combat financial fraud.

Plea Agreement and Settlements

As part of the plea agreement, Danske Bank has agreed to pay approximately $850 million in payments to the Securities and Exchange Commission (SEC) and the Danish authorities. The SEC has also announced a separate settlement with Danske Bank, requiring the bank to pay an additional $413 million.

Prosecution and Investigation

The case is being prosecuted by the US Department of Justice’s Money Laundering and Asset Recovery Section, along with Assistant US Attorneys from the Southern District of New York. The FBI is investigating the case, which marks one of the largest financial fraud cases in recent history.

Troubled History and Reputation

Danske Bank’s guilty plea comes as no surprise to many, given the bank’s troubled history with regulators and its reputation for questionable business practices. The bank has faced numerous investigations and fines in recent years, including a $642 million fine imposed by the Danish Financial Supervisory Authority in 2018.

Significance of the Resolution

The US Department of Justice’s resolution with Danske Bank is seen as a significant victory in the fight against financial fraud, highlighting the importance of cooperation between international authorities in combating global financial crimes.