Danske Bank, Denmark’s largest financial institution, pled guilty Dec. 13 to defrauding U.S. banks and agreed to pay a $2 billion penalty.
Denmark is known for its financial transparency and has reliably been highly ranked for its lack of corruption. It was listed as the least corrupt country in the world, alongside Finland and New Zealand, in both 2021 and 2020 by Transparency International, an advocacy and research group collecting data on global corruption.
However, between 2008 and 2016, Danske Bank’s branch in Estonia allegedly processed nearly $160 billion from high-risk foreign customers, many of whom were Russian, according to a press release from the U.S. Justice Department. Despite being aware in February 2014 that the branch was funneling “highly suspicious and potentially criminal transactions” to U.S. banks after warnings from an internal whistleblower, audits and regulators, Danske Bank continued to lie to U.S. financial institutions about its anti-money laundering standards.
In addition to forfeiting $2.059 billion, Danske Bank will pay the U.S. Securities and Exchange Commission (SEC) around $413 million under a parallel settlement. The Justice Department said it will credit Danske Bank nearly $850 million in order to resolve its claims with the SEC and Danish authorities. The Danish Bank also committed to implementing a revamped compliance program and anti-money laundering controls.
“For years, Danske Bank lied and deceived U.S. banks to pump billions of dollars of suspicious and criminal funds through the U.S. system,” said Damian Williams, U.S. Attorney for the Southern District of New York, in a statement. “Banks and other financial institutions around the world should heed this message: If you want to use the U.S. financial system, you must play by the rules.”
