Bank Regulation

Danske’s Money Laundering Fine Could Be Lower Than Expected In US

Without U.S. Banking License, Danske Bank Fine Could Be Very Low

A fine for embattled banking institution Danske Bank could be much lower lower than expected in the U.S. because the institution does not have a banking license in the country, according to a report by Reuters.

Danske Bank was involved in a much publicized money-laundering scandal, but the U.S. fine for the money laundering will likely be much lower than expected, according to anonymous banking sources cited in a report by S&P Global Market Intelligence, Reuters said.

“Everyone is talking about this big U.S. fine. I don’t see it,” the source said. 

Both the Justice Department and the U.S. Securities Exchange Commission are investigating Danske Bank. The potential fine has been worrying investors due to the large size of past fines for banks in the U.S.

Danske shares have been almost halved due to the scandal and the investigation. Shares in the organization went up 5.5 percent in early trading on Friday (Jan. 31), but that was potentially just a delayed reaction to the report published this week.

“I think this is the first time we have seen in an actual article that legal experts are saying this,” said Jyske Bank analyst Anders Haulund Vollesen.

In December, it was reported that Danske Bank was facing a lawsuit from an estimated 60 investors over the issue. It’s actually the third lawsuit about the issue, and the plaintiffs want 1.5 billion crowns ($224 million). Previous lawsuits are involve 232 pension funds, and another claim wants $800 million. Danske said it was going to fight the suits.

“We will defend ourselves against the demands and deal with any development in collaboration with the bank’s lawyers,” Danske said.

One lawsuit was filed in the District Court of Copenhagen, with the Danish law firm Nemeth Sigetty performing the actual filing.

The investors include insurance companies, pension funds and managers of assets from a number of countries. They are being represented by the International Securities Associations and Foundations Management Company for Damaged Danske Investors (ISAF-Danske).



The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.