Update: Danske Bank Warns of Potential Resumption of French Money-Laundering Probe
January 11 2019 - 5:44PM
Dow Jones News
By Samuel Rubenfeld and Dominic Chopping
Danske Bank A/S said Friday a French judge expects to put the
lender back under investigation for alleged money laundering.
Danske Bank already is under investigation in Denmark, Estonia,
the U.K. and the U.S. for allegedly facilitating the laundering of
about $230 billion through its Estonian branch by non-Estonian
customers between 2007 and 2015. The scandal has led to the
departure of several top bank executives.
The bank, Denmark's largest, said Friday it had been charged in
October 2017 with violating France's anti-money-laundering laws,
but in January 2018 its status was downgraded to that of an
assisted witness.
In the statement, the bank said it received a letter this month
from a French investigating judge summoning Danske back for an
interview. The judge expects to place the bank back under formal
investigation, with the French probe expanding in scope, the bank
said, citing the letter.
A spokeswoman for the French national public prosecutor's office
didn't respond to requests for comment.
The potential resumption of charges against Danske comes a day
after Hermitage Capital Management co-founder Bill Browder held a
press conference at the Danish parliament concerning allegations he
brought to France against the bank.
Hermitage had filed a criminal complaint in France in 2013
concerning illicit money flowing into the country that stemmed from
a tax theft in Russia. Some of the money from the tax theft,
according to Hermitage, had flown to France through Danske Bank's
Estonia branch.
A Hermitage lawyer, Sergei Magnitsky, had exposed the theft but
was arrested on charges he'd carried it out and later died in
Russian custody. Mr. Browder has spent the years since chasing down
the funds, which were spread across the globe, and seeking the
prosecution of those who laundered the money.
Mr. Browder submitted a request in late December for Danske Bank
to be elevated back to a suspect in the case, he said in an
interview Friday. He accused the bank of making misstatements about
its awareness of money-laundering activity when testifying before
the French magistrate in October 2017.
A Danske spokesman said the bank doesn't believe it misled the
French authorities. "On the contrary, it is clearly in our interest
to obtain as accurate a picture of what happened in Estonia as
possible," the spokesman said, declining to comment further about
its discussions with French authorities.
The news about the French probe comes days after a U.S. pension
fund, Plumbers & Steamfitters Local 773 Pension Fund, announced
a class-action lawsuit against Danske Bank, alleging the bank had
defrauded investors by inflating its share price when failing to
disclose the money-laundering problems in Estonia.
The Danske spokesman said the bank is aware of the lawsuit filed
by the pension fund and that several law firms have indicated
similar suits are coming. "We will consider the lawsuit and the
further process in consultation with our legal counsel," he
said.
Write to Samuel Rubenfeld at samuel.rubenfeld@wsj.com and
Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
January 11, 2019 17:29 ET (22:29 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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