Estonia: Money laundering scandal at Danske Bank
The public prosecutor's office in Estonia has launched an investigation against the Estonian branch of Danske Bank. For several weeks now the bank has faced allegations of having laundered up to nine billion dollars, most of which came from Russia. Journalists are appalled by the authorities' slowness in reacting to the affair.
A cordial invitation to launder money
The unwillingness of the Estonian prosecutor's office to investigate the case could have unpredictable consequences, warns opposition MP Igor Gräzin in Eesti Päevaleht:
“Even today the public prosecutor is still saying that the investigation would be fruitless. While she focusses on relatively small cases that receive a lot of attention from the media, major crimes are going uninvestigated because there is no time left for them. ... Whereas we, as a digital state, want to have a transparent financial and banking sector, we have a public prosecutor's office that not only doesn't prevent money laundering but on top of that explains that an investigation would be useless anyway. A very unusual way of welcoming 'investors' from all over the world.”
Government looking the other way
Journalist Marcus Kolga laments in Postimees the hesitant reaction of the Estonian government:
“Even if this step shows that the state is finally taking Russian money laundering seriously and is willing to take action against it, a broader state reaction and official investigations are needed to restore the trust of Western states in Estonian financial institutions. ... The problems with money laundering have been evident since the investigation of the Estonian branch of Danske Bank in 2015. While Estonia is otherwise known for its progressive anti-corruption policy, so far it has failed to react appropriately to the suspicions against Danske Bank. Yet we're talking about a huge sum here: nine billion dollars, just a billion less than Estonia's national budget. And this is all money from corrupt sources linked to the Kremlin.”
Estonia as the whipping boy
Danske Bank earned a good deal through money laundering but it's Estonia that will pay the price, Äripäev laments:
“In 2013 the Estonian subsidiary, which accounts for just 0.5 percent of the company, generated two percent of its profit. ... This was at a time when Danish banks were experiencing major difficulties owing to low interest rates and Danske closed umpteen branches. Burk Files, a US money laundering expert, analysed the documents for Berlingske and summed them up as follows: 'The management of Danske Bank seems foolhardy. The accounts I've seen look like something from a textbook on money laundering.' Estonia will now be seen as a former Soviet republic through which dirty money is moved.”
No one cares what happens in Eastern Europe
Helsingin Sanomat is amazed at how well Danske Bank is doing despite the money laundering scandal so far - also in comparison with Nordea Bank, which did much to help Northern European customers minimise their taxes through tax havens:
“There has been surprisingly little fuss until now over another Northern European bank, Danske Bank. Its Estonian branch laundered billions of euros. ... The money apparently came from the East, Russia among other places. ... Yes, Danske Bank has admitted irregularities, but it hasn't specified any sums. Yet the money laundering has neither caused a public outcry nor scared away customers. Perhaps it's less of an offence to help crooks from Eastern Europe than Danish crooks.”