Denmark’s Danske Bank has been awarded the undesirable 2019 Corrupt Actor of the Year award from the Organized Crime and Corruption Reporting Project (OCCRP).
The bank was embroiled in a money laundering scandal this year after revelations from a whistleblower. The bank’s Estonian branch played in allowing billions of dollars to be laundered over the past decade.
Earlier this year, European Union Justice Commissioner Věra Jourová described the money-laundering case involving Danske Bank as “the biggest scandal in Europe“ while the Guardian newspaper described the most recent scandal as involving “32 currencies, companies from Cyprus, the British Virgin Islands and the Seychelles.”
Danske Bank Estonia was revealed as the hub of a $234bn money laundering scheme involving Russian and Eastern European customers.
In one operation, billions of dollars flowed through Danske’s Estonian branch from Azerbaijan to offshore companies, high-ranking officials, and even European politicians who praised the nation’s regime despite its chronic human rights abuses, according to an OCCRP report.
“In Azerbaijan, Danske Bank was the conduit for bribes, parking stolen assets, and the theft of national resources for one of the most vindictive and corrupt regimes in the world,” OCCRP co-founder and judge Paul Radu said, adding that “the corrupt Aliyev family couldn’t have done this without the bank.”
READ MORE: Malta and Azerbaijan: A sordid love affair
Last year, the OCCRP broke the story of the ‘Azerbaijani Laundromat’. They discovered the existence of a €2.9 billion slush fund that was being used to gloss over the troubling human rights record of the country, in multiple EU Member States, as well as the Council of Europe and UNESCO.
Malta enjoys an uncomfortably cosy relationship with Azerbaijan. In March 2017, Freedom Files – an NGO that conducts research on human rights and democracy problems in authoritarian countries published a detailed report which revealed that “Malta is considered by Azerbaijani oligarchs as one of the “provinces” of Azerbaijan.”
Several members of the Azeri ruling elite were also found to have held accounts at the now defunct Pilatus Bank in Malta whose owner Ali Sadr Hasheminejad was arrested over charges of breaching US sanctions.
According to an investigation by the Daphne Project, over the past three years, several networks of companies appear to have used Pilatus Bank for secret investments in the UK, Spain, France, Georgia and Montenegro.
Danske Bank is also being investigated by the U.S. Justice Department and, according to Bloomberg News, has admitted that its Estonian branch was a central causeway for illicit funds from the former Soviet Union. About $230 billion in transactions are under scrutiny, Bloomberg reported.
Danske Bank Estonia has also been implicated in other money-laundering schemes.
An OCCRP investigation — the Russian Laundromat — revealed that $20 billion to $80 billion was fraudulently moved out of Russia through a network of global banks that included Danske.
Danske stock has plunged by half in the last year amid a separate European Union investigation and as other inquiries proliferate.
The Danske Bank operation demonstrates “the structural nature of corruption,” South African anti-corruption activist Hennie van Vuuren, said.
Danske is still in business, but its chief executive, Thomas Borgen, stepped down following a report that revealed the full extent of problems at the Estonian branch. It had thousands of suspicious customers, responsible for over €200bn of transactions over a nine-year period.