Danske Bank chief steps down amid €200 billion money laundering probe

The chief executive of Denmark’s largest bank Danske Bank resigned on Wednesday amid allegations of a money laundering scandal at the lender’s Estonian unit.

Thomas Borgen, who has headed the bank since 2013, resigned following the publication of an internal investigation covering around €200 billion of payments made through its Estonian branch between 2007 and 2015.

The bank said “major deficiencies” in oversight at the branch opened the door for suspicious payments by non-resident customers from places like Russia, the UK and the British Virgin Islands.

Although it does not imply illegal activity, the payments should have been flagged up to the authorities as suspicious.

“The bank has clearly failed to live up to its responsibility in this matter,” said chairman Ole Andersen

“The findings of the investigations point to some very unacceptable and unpleasant matters at our Estonian branch, and they also point to the fact that a number of controls at the Group level were inadequate in relation to Estonia.”

Shares shed 8% on Wednesday and are down by a third so far this year.

Danske’s Estonian branch had 15,000 customers, who carried out €200 billion worth of payments.

The riskiest 6,200 customers were assessed and the “vast majority have been found to be suspicious,” the report found.