Between 2007 and 2015, Danske Bank, the largest financial institution in Denmark, actively participated in the largest money laundering scheme in Europe. More than EUR 200 billion of suspicious payments passed through its Estonian branch with the knowledge of the bank’s top management.
The scandal emerged only in February 2018, following various press reports, while the seriousness of the situation had already been known among the bank’s top management for a long time. A whistle-blower report had conveyed serious money laundering concerns to the board in December 2013. Additionally, in February 2014, the conclusions of an internal audit were communicated to and discussed by the bank’s top management.
The former CEO of Danske Bank had also overseen the Estonian branch during the money laundering operation. Despite red flags having been raised as early as 2007, and a number of investigations performed by local regulatory authorities over the years, Danske Bank only decided to shut down the non-resident portfolio of its Estonian branch in December 2015. It would later appear that the bank continuously misled local regulators. The bank is currently under criminal investigation in Denmark, Estonia and the United States and substantial fines can be expected. As of today, not a single senior executive has been held accountable.
Deminor believes that investors were misled at least from February 2014 onwards. This means investors have a viable cause of action against the bank and its officers for the losses suffered as a result of the corrective disclosures made as from February 2018.
On 20 February 2020 Deminor filed a complaint with the court of Lyngby on behalf of a group of 72 legal entities representing 155 institutional investors. They seek damages in the amount DKK 2,6 billion (approximately EUR 358 m) from Danske Bank’s former CEO. Danske Bank, the auditors and the (former) members of the senior management were also formally notified of the claims.