A former U.S. Justice Department attorney has said that Danske Bank A/S may not be sanctioned by the U.S. due to its involvement in a multibillion-dollar money-laundering scandal in Baltics because the U.S. law does not penalize banks with no U.S. license even though the estimated potential fine is pegged at $9 billion. The largest bank by assets in Denmark has admitted that a significant number of transactions in their Estonia branch was suspicious as about 200 billion euros of non-resident money flowed through it. Citing the $1.92 billion penalty paid by UK-based HSBC Holdings PLC in 2012, lawyers specializing in money laundering said how the U.S. will find Danske is yet to be clear as banks can only be charged for lacking anti-money laundering controls and not for money laundering as a crime and also that affirmative money laundering is difficult to prove. While it is not impossible for U.S. authorities to run a case against Danske under this regulation, he said it would require “a lot of forensic accounting” along with access to evidence that can confirm there was intent and knowledge about the dirty transactions, for example through an insider. In 2015, French bank BNP Paribas SA and some other highest banks have been sanctioned by U.S. authorities. Although the U.S. is still finding it difficult to indict Danske the bank is considering entering negotiation to settle the dispute because public companies frequently chose to follow settlement route to afford massive case to trial.
On August 7, 2012, UK-based Standard Chartered PLC’s share price fell 16% in just a day after the threat of the New York State Department of Financial Services to hold a formal hearing on the bank’s operating license over Iran transactions but the share began to recover after a settlement of $340 million was made on August 14, 2012. Meanwhile, Danke’s share has suffered a drop below 55% since the beginning of 2018, this may be the reason why Danke is mulling attempting negotiating a “so-called global settlement” in order to avoid double payment for a single offence but the likely time for the settlement maybe 2021. Danske, meanwhile, said in an email: “We continue to cooperate with the authorities and make ourselves — and the knowledge we have — available to the investigations, but we are not able to estimate when the authorities will complete their investigations or speculate on the outcome. The amount is a probability-weighted estimate, assuming a low likelihood of U.S. sanctions breaches. Mads Thinggaard, an equity analyst at ABG Sundal Collier, estimates that Danske will make a 4 billion kroner, roughly $600 million, a settlement with the Danish authorities only. This is based on the assumption that no U.S. sanctions were breached. He said this corresponds to a settlement similar to that of ING Groep NV in 2018, where U.S. authorities closed investigations into a money-laundering case without enforcement after the Dutch bank paid €775 million to settle the case with Dutch authorities.
