Danske Bank’s $235bn money laundering surpasses crypto market’s cap

October 01, 2018
Chris Wheal

Denmark’s Danske Bank, at the centre of a money laundering scandal involving activities at its Estonia branch between 2007 and 2015, is believed to be responsible for illegal payments totalling $235bn.

The massive figure, noted on social media by Morgan Creek Digital founder and partner Anthony Pompliano over the weekend, exceeds the entire cryptocurrency market’s current total market capitalisation, which is estimated at $225bn.

Commenting on Twitter, Pompliano obliquely suggested the episode should give renewed faith to cryptocurrency investors subdued by criticism of the industry or sustained low prices.

“REMINDER: A single bank location at one bank laundered more money than the entire market cap of cryptocurrencies,” he wrote. “Long Bitcoin, Short the Bankers.”

Ironic message

Before the revelations of its own activities became public, Danske had adopted a hawkish tone on cryptocurrencies and advised potential investors to steer clear of them.

“Most importantly, the lack of transparency and regulatory control have made cryptocurrencies a target for criminal purposes and we know that they on several occasions have been involved in criminal transactions like money laundering or extortion,” the bank stated.

As a financial institution, we have an obligation to assist in the fight against financial crime and money laundering. At the current stage, cryptocurrencies do not offer the sufficient level of transparency in order for us to live up to our obligations within anti money laundering [AML] regulation.”

Danske Bank's ex-CEO Thomas Borgen

Danske Bank’s ex-CEO Thomas Borgen

Danske’s chief executive Thomas Borgen had been expected to stay in his role while a replacement was sought, but the bank has since removed him and promoted its current Danish operations head Jesper Nielsen as interim CEO.

The Danish bank’s embarrassment echoes that of Dutch lender Rabobank, which refused accounts to bitcoin businesses and cited “compliance risks” and whose Califiornia operations were subsequently charged with involvement in money laundering.



Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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