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Editorial Comment: Danske's Dirty Money Settlement Shows Complacency Isn't An Option

Tom Burroughes

23 December 2022

The most eye-popping of anti-money laundering fines and settlements may appear to have passed. The $8.97 billion settlement with the US in July, 2014 is an unenviable record. (That sum was so high it hit US-France relations, and even Russian President Vladimir Putin, ironically, complained about it.) 

But the case last week of Danske Bank’s $2.06 billion fine, confiscation and forfeiture settlement with US and Danish authorities over dirty money in Estonia is a reminder of how large these cases can be and why the fight against money laundering goes on.

On 16 December the Copenhagen-listed lender reached final coordinated resolutions with the , a provider of know your client (KYC) and client lifecycle management (CLM) solutions, noted this additional activity in an August report.

The study said that the total size of penalties imposed on financial firms has recently fallen. (The pandemic and the associated disruption may have interfered with enforcement and investigative activity, among other factors.)

It is true that regulators want to control more types of wrongdoing than a few years ago, and the ESG agenda certainly adds to the workload. It may cause an enforcement bottleneck on what might be more “core” types of work, such as AML and KYC enforcement, although ESG is, to an extent, just another form of risk management and due diligence.

Whatever the specifics, the Danske Bank settlement last week was a stark reminder that the battle against dirty money has no end, and with geopolitical instability front of mind, the banking industry is very much a part of the agenda. Banks cannot afford to be complacent.

(As a side-note, this news service was proud to run this sobering interview with a former investment banker, and a venture capitalist, who is based in Ukraine and was engaged in the fighting in defence of that country.)