From the markets to the boardroom to the picket line, the reach of Danske Bank’s money laundering fraud scandal continued to play out this week.

Reuters delivered several stories. A Wednesday morning story reported  that foreign investors sold Danish shares worth almost $14 billion in 2018, according to a report from Denmark’s central bank.

The divestment of bank equities may reflect a loss of confidence in the Danish banking sector in the wake of Danske Bank’s money laundering case, it said.

“The trust from international investors has certainly been reduced,” governor Lars Rohde told reporters in Copenhagen. He said political initiatives to combat money laundering were paramount to restore foreigners’ trust in Danish banks.

Rohde is the chairman of the board of governors of Danmarks Nationalbank.

Danske-Bank-Whistleblower-Howard-Wilkinson. Source: www.kkc.com
Howard Wilkinson

The Danske Bank scandal was exposed by whistleblower Howards Wilkinson. He reported suspicious financial transactions at bank’s Estonia branch, where he worked until 2014. It has been calculated that up to $20 billion in fraudulent financial activity have been brought to light by Wilkinson’s disclosures.

Stephen M. Kohn, Wilkinson’s whistleblower attorney, said in a statement that whistleblowers need to be supported, not vilified: “If the Bank had simply properly investigated Mr. Wilkinson’s initial disclosures in 2012 and 2013, they could have avoided most of this mess.”

Continue Reading Investors bail while shareholders demand answers and action from Danske Bank on money laundering scandal

Whistleblowers would be permitted to report wrongdoing to outside authorities before reporting to their company or agency’s internal review program, according to a provisional rule approved this week by the European Commission and member countries.

Virginie Rozière, a French Member of the European Parliament (MEP)
French MEP Virginie Rozière, via press conference video.

Action on the EU whistleblower directive had been stalled over the reporting issue. Several member countries, led by Germany and France, wanted to require employees to report potential crimes and fraud internally before going to regulators and law enforcement. Transparency, anti-corruption groups and their supporters believe that approach would have made it more difficult for individuals to come forward with information about wrongdoing.

“The debate has been quite lively over the course of the last few weeks,” Virginie Rozière, a French Member of the European Parliament (MEP) said in French at a press conference following the decision.

The provisional rule allows for what are called “safe reporting channels.”

From the European Commission release:

Whistleblowers are encouraged to report first internally, if the breach they want to reveal can be effectively addressed within their organisation and where they do not risk retaliation. They may also report directly to the competent authorities as they see fit, in light of the circumstances of the case.

Transparency International called the provisional rule “a pathbreaking piece of legislation,” citing the case of Danske Bank whistleblower Howard Wilkinson.

“Whistleblowers in the EU, like Howard Wilkinson, the Danske Bank whistleblower, have spent far too long facing unjust retaliation for speaking out. It is quite an accomplishment that negotiations between the institutions have come to a positive end,” according to a statement from Nick Aiossa of Transparency International.

Continue Reading After a “lively debate,” EU commission approves provisional whistleblower protection law offering “safe channels” to report wrongdoing

Estonian Financial Supervision Authority logo
Seal of the Estonian EBFS

Danske Bank has been ordered to close its troubled Estonian branch before the end of 2019.  Estonian regulators noted on February 19 that the bank violated anti-money laundering regulations for many years by allowing high-risk money-laundering clients to make suspicious transactions through the bank.

In addition, they stated that Danske Bank misled the Estonian public authorities by providing them with inadequate information and thus actually hampered their investigation, according to a statement from the Estonian Board of Financial Supervision.

Danske Bank announced the same day that it is also closing banks in Latvia and Lithuania and Russia.

In a related move, the European Union Banking Authority has opened a formal investigation “into a possible breach of Union law by the Estonian Financial Services Authority and the Danish Financial Services Authority in connection with money laundering activities linked to Danske Bank and its Estonian branch in particular.”

Here’s a roundup of reaction and reporting:

“This is a lesson to corporate banks.  Danske Bank made a grave error when it forced Mr. Wilkinson to sign a restrictive non-disclosure agreement, instead of working with Mr. Wilkinson in trying to fix the problems,” according to a statement from Kohn. Continue Reading A whistleblower exposed money laundering at Danske Bank’s Estonian branch. Now the government is shutting it down.

April 18, 2016. Today is “Tax Day,” when millions of Americans honestly pay their fair share of taxes. Today is also a day we all owe thanks to the whistleblowers who forced over 54,000 American tax cheats who held illegal accounts in Switzerland to plead guilty to their crimes and pay their back taxes and penalties.

These prosecutions, both civil and criminal, have also resulted in major Swiss banks going bankrupt, others pleading guilty to crimes and paying billions in penalties. All told, as of today over $13.769 billion has been collected from the Swiss banking cheats, and billions more will be recovered as the prosecutions continue.

Here is the story. Continue Reading 13.769 Billion Reasons to Thank Whistleblowers on Tax Day