In 2013, Danske Bank was made aware of potential money laundering through its branch in Estonia. The whistleblower report suggested that the bank was being used by Putin’s family and a group of accused money launderers to launder funds, and that the Russian Intelligence Service, the FSB, was also using it for the same purpose. The bank may also have been used in sanctions evasion.
Danske Bank is now examining a further $150 billion in transactions received between 2007 and 2015.
Correspondent banks used by Danske Bank have also been named publicly and include JP Morgan, Bank of America, Deutsche Bank AG, and Citigroup’s Moscow branch. At least one bank, Deutsche Bank, has been reprimanded for inadequate AML processes.
Analysis: The report highlighted a near total failure of the bank’s AML controls, and suggested that the bank may have committed a criminal offence. This highlights deficiencies in Danske Bank well beyond a compliance issue, and instead suggests potential complicity in the activity by one or more employees at the branch. While AML/CFT norms and regimes are by no means fool proof, the easiest way around them is often to have a helpful insider, something that is almost certainly required for this scale of illicit financing.