Deutsche Bank Named in Danske Bank Money Laundering Scandal

Reports on Monday suggest that Deutsche Bank is being pulled into the ongoing scandal surrounding Danske Bank’s Estonian office.

A Whistleblower Whistleblower A whistleblower is an individual who manages to provide information or activity within a private or public organization that is deemed illegal, unethical, or not correct. In many countries, including the United States, whistleblowers are protected by law and in some cases can even recoup rewards if their information leads to successful prosecution.In the context of the financial services industry, whistleblowers play a large role in oversight, helping unmask several episodes of illicit behavior A whistleblower is an individual who manages to provide information or activity within a private or public organization that is deemed illegal, unethical, or not correct. In many countries, including the United States, whistleblowers are protected by law and in some cases can even recoup rewards if their information leads to successful prosecution.In the context of the financial services industry, whistleblowers play a large role in oversight, helping unmask several episodes of illicit behavior Read this Term at the Danish bank, a former Head of Trading named Howard Wilkinson, exposed an array of suspicious activity at the bank that took place between 2007 to 2014.

It is thought that up to $250 billion of suspect funds were handled by Danske Bank’s Estonian branch in that time period, with illicit funds flowing in from Russia, Ukraine, and Azerbaijan.

The scale of the fraud - which some have termed the largest Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term case in history - forced Danske Bank’s CEO, Thomas Borgen, to resign last month.

“It is clear that Danske Bank has failed to live up to its responsibility in the case of possible money laundering in Estonia,” said Borgen. “I deeply regret this.”

Deutsche Bank - the oligarchs' correspondent bank

In the wake of Borgen’s resignation, the names of several other major firms that helped Danske Bank in its efforts, amongst them Bank of America and JP Morgan, have started to emerge.

But according to a Bloomberg report released this Monday, it was Deutsche Bank that played the largest role in helping the Danish firm purify its allegedly ill-gotten gains.

Speaking to Danish lawmakers, Wilkinson said that he believed more than half of the funds processed by Danske Bank were handled with a "large European lender" - named by Bloomberg as Deutsche Bank - acting as a correspondent bank.

“This was the main correspondent bank for U.S. dollars,” said Wilkinson. “And they were the last one to go, it took them until 2015, at least nine years.”

Criminal investigators in the US have been in contact with Deutsche Bank according to Bloomberg’s report. What the fruits of that investigation will be, if they are indeed speaking to the German firm, remain to be seen.