Reported by: U.S. Department of Justice

Danske Bank A/S (Danske Bank), a global financial institution headquartered in Denmark, pleaded guilty today and agreed to forfeit $2 billion to resolve the United States’ investigation into Danske Bank’s fraud on U.S. banks.

According to court documents, Danske Bank defrauded U.S. banks regarding Danske Bank Estonia’s customers and anti-money laundering controls to facilitate access to the U.S. financial system for Danske Bank Estonia’s high-risk customers, who resided outside of Estonia – including in Russia. The Justice Department will credit nearly $850 million in payments that Danske Bank makes to resolve related parallel investigations by other domestic and foreign authorities.

According to admissions and court documents, between 2008 and 2016, Danske Bank offered banking services through its branch in Estonia, Danske Bank Estonia. Danske Bank Estonia had a lucrative business line serving non-resident customers known as the NRP. Danske Bank Estonia attracted NRP customers by ensuring that they could transfer large amounts of money through Danske Bank Estonia with little, if any, oversight. Danske Bank Estonia employees conspired with NRP customers to shield the true nature of their transactions, including by using shell companies that obscured actual ownership of the funds. Access to the U.S. financial system via the U.S. banks was critical to Danske Bank and its NRP customers, who relied on access to U.S. banks to process U.S. dollar transactions. Danske Bank Estonia processed $160 billion through U.S. banks on behalf of the NRP.

U.S. banks required Danske Bank and Danske Bank Estonia to provide information to open and maintain accounts, including information related to anti-money laundering (AML) controls, transaction monitoring, and customers. Danske Bank knew that the U.S. banks expected honest, complete, and accurate responses and that the U.S. banks would not maintain, or open, U.S. dollar accounts for Danske Bank Estonia without the required information. 

By at least February 2014, as a result of internal audits, information from regulators, and an internal whistleblower, Danske Bank knew that some NRP customers were engaged in highly suspicious and potentially criminal transactions, including transactions through U.S. banks. Danske Bank also knew that Danske Bank Estonia’s anti-money laundering program and procedures did not meet Danske Bank’s standards and were not appropriate to meet the risks associated with the NRP. Instead of providing the U.S. banks with truthful information, Danske Bank lied about the state of Danske Bank Estonia’s AML compliance program, transaction monitoring capabilities, and information regarding Danske Bank Estonia’s customers and their risk profile.

Today, Danske Bank pleaded guilty to one count of conspiracy to commit bank fraud. Under the terms of the plea agreement, the company has agreed to criminal forfeiture of $2.059 billion. Danske Bank will also enter into separate criminal or civil resolutions with domestic and foreign authorities and the department will credit approximately $850 million in payments the bank makes to the SEC and the Danish authorities.

Read full report: https://www.justice.gov/opa/pr/danske-bank-pleads-guilty-fraud-us-banks-multi-billion-dollar-scheme-access-us-financial