Danske Bank A/S chief executive Thomas Borgen yesterday quit in a money-laundering scandal that involved 200 billion euros (US$234 billion) flowing through its Estonian branch between 2007 and 2015, most of which was suspicious.
“It is clear that Danske Bank has failed to live up to its responsibility in the case of possible money laundering in Estonia. I deeply regret this,” Borgen said in a report that detailed failings in compliance, communication and controls.
Regulators and the financial community are to scrutinize the report, which follows calls by Brussels for a new EU watchdog to crack down on financial crime after a series of scandals involving anti-money laundering controls.
Dutch bank ING this month said that criminals had been able to launder money through its accounts and agreed to pay 775 million euros to settle the case.
One-third of Danske Bank’s stock market value has been wiped out in the past six months, driven mainly by concerns over a possible inquiry by US authorities and the penalties this could entail.
Danske Bank said its investigation into the affair concluded that Borgen, chairman Ole Andersen and the board of directors “did not breach their legal obligations toward Danske Bank.”
While Danske said it was not able to provide an accurate estimate of the suspicious transactions through its Estonian branch, it said the non-resident portfolio included customers from Russia, Azerbaijan, Ukraine and other former Soviet states.
The report found that Danske Bank failed to take proper action in 2007, when it was criticized by the Estonian regulator and received information from its Danish counterpart that pointed to “criminal activity in its pure form, including money laundering” estimated at “billions of rubles monthly.”
When a whistle-blower raised problems at the Estonian branch in early 2014, the allegations were not properly investigated and were not shared with the board, Danske said.
While it took measures to get its Estonian business under control in 2014, these were insufficient, the report said.
Danske Bank also said it had decided not to migrate its Baltic banking activities onto its IT platform, because it would be too expensive.
Accordingly, the Estonian branch did not employ Danske’s anti-money laundering procedures.
US authorities earlier this year accused Latvia’s ABLV Bank AS of covering up money laundering and the bank was promptly denied US dollar funding, leading to its collapse.
While Danske does not have a banking license in the US, banning US correspondent banks from dealing with it would amount to shutting it out of the global financial network.
The bank, whose shares fell as much as 5 percent following the release of the report, also lowered its expectations for annual net profit to 16 billion to 17 billion Danish crowns (US$2.51 billion to US$2.67 billion), from a previous range of 18 billion to 20 billion Danish crowns.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
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