Decision concerning Danske Bank's management and control in the Estonian money laundering case
Today, the Danish FSA has issued its decision on Danske Bank's management and control in the money laundering case at the bank's branch in Estonia. The decision comprises eight orders and eight reprimands, and indicates the need for an increase in the bank's capital requirement by DKK 5bn due to increased compliance and reputational risk.
Translation from original text in Danish. In case of discrepancies, the Danish version prevails.
The decision is based on the Danish rules on, inter alia, management and control, and therefore concerns the activities that have or should have been carried out by Danske Bank's management in Denmark. The specific questions concerning the lack of anti-money laundering measures in the Estonian branch are the responsibility of the Estonian authorities.
"Our investigation shows that there have been serious deficiencies in the bank's governance. The bank acted too late on information concerning the lack of anti-money laundering measures and on suspicion of criminal activities of customers, which it received from sources that include an internal whistle-blower," says Jesper Berg, Director General of the Danish FSA.
"The bank's governance has not ensured that the problems in Estonia have been handled in a satisfactory way, including by reporting suspected crime to the relevant authorities," says Jesper Berg.
The Danish FSA also notes in the decision that the conduct of Danske Bank's management has damaged the bank’s reputation. Therefore, the decision indicates the need for an increase in Danske Bank's capital requirement by DKK 5bn in order to account for the fact that the bank's compliance and reputational risk is substantially higher than previously assumed.
In connection with the decision, the Danish FSA has determined that, as matters now stand, there is not basis for initiating legal proceedings against the current management or other employees at the bank, in accordance with the fit & proper rules.
No later than 30 June, Danske Bank must document compliance with the orders of the decision.