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Estonia vs Denmark: The Battle for Danske Blame Begins

A war of words erupted this week as Danish and Estonian regulators attempted to shift blame for the Danske Bank money laundering scandal that is currently under investigation in Denmark, Estonia, Britain and the United States.

A total of 200 billion euros (US$229 billion) of suspicious payments passed through the Estonian branch of the Danish bank between 2007 and 2015.

The Danish Financial Supervisory Authority (FSA) released a financial supervision report on Tuesday, placing responsibility on the Estonian regulator for one of Europe’s biggest scandals.  

“The Estonian supervisory authority (EFSA) has had and still has responsibility for the anti-money laundering (AML) supervision of the Estonian branch,” said the Danish FSA.

It claimed its Estonian counterpart failed to carry out comprehensive anti-money laundering checks.

“The effort of asking detailed questions...and going more into detail to obtain true and fair information did not work out as intended.”

The EFSA rejected Denmark’s allegations.

“The Financial Supervision Authority is somewhat astonished by the firm assertion of Danish financial supervision,” they replied in a statement on Thursday.

“The task of Danish financial supervision was and is to oversee the organization and management of Danske Bank, including at its branches.”

The Estonian regulator emphasised the role it played in finally ending Danske’s non-residency business in 2015 after “seeing that Danish supervision is not working.”

They highlighted Danske's failure to integrate the Estonian branch’s IT systems with the rest of the bank once it was bought from Sampo Bank in 2007. This made it impossible to adequately identify potential money laundering, they claimed.  

In its annual report released on Friday, Danske announced it will spend two billion Danish Krone ($307 million) to improve its anti-money laundering controls.

occrp.org

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