Danske Bank CEO quits, ABN Amro to pay $766 million in Dutch money laundering probe

AMSTERDAM (BLOOMBERG, REUTERS) – Danske Bank is replacing Mr Chris Vogelzang as its chief executive officer after the former ABN Amro executive became the target of a Dutch money-laundering investigation.

Separately, ABN Amro said it had reached a €480million (S$766 million) settlement with prosecutors over the laundering allegations, which will impact its first-quarter results.

Danske’s Mr Vogelzang, who had been CEO for less than two years at Denmark’s biggest bank, will be replaced by Danske’s head of risk management, Mr Carsten Egeriis.

“This follows a decision by the Dutch authorities to name him a suspect in connection with their investigations of potential violations of Dutch legislation relating to the prevention of money laundering at ABN Amro,” Danske said in a statement on Monday (April 19).

“I am very surprised by the decision by the Dutch authorities,” Mr Vogelzang said in the statement. “I left ABN Amro more than four years ago and am comfortable with the fact that I managed my management responsibilities with integrity and dedication. My status as a suspect does not imply that I will be charged.”

ABN Amro said in a statement on Monday it had agreed to pay a fine of €300 million and €180 million as disgorgement reflecting “the seriousness, scope and duration of the identified shortcomings” in combating money laundering.

The prosecution service said in a statement its investigation was ongoing and that three former board members, who it did not name, had been identified as suspects said to be “effectively responsible for violation” of the anti-money laundering act.

The investigation into ABN Amro started a year after fellow Dutch bank ING paid a record fine of €775 million to settle a similar case. Although the ING settlement stated that no bank managers would be prosecuted, a Dutch court in December last year ordered a criminal investigation into the role of former CEO Ralph Hamers in the affair after all.

Prosecutors in September 2019 accused ABN Amro of failing to spot accounts involved in money laundering, failing to end relations with suspicious clients and failing to report such transactions to the relevant authorities.

Danske is itself the subject of multiple investigations into money laundering in both the US and Europe. Mr Vogelzang had been brought on board in 2019 in an effort to help the bank clean up its act and rehabilitate its image as a law-abiding, transparent institution.

The Danish bank gained international notoriety back in 2018, when it admitted that a large part of 200 billion euros in non-residential flows through a unit in Estonia was suspicious. That ended the career of a string of Danske executives, including former CEO Thomas Borgen, who has himself been the target of several investigations linked to the affair.

Mr Borgen was initially replaced by Jesper Nielsen, who climbed the ranks within Danske. Mr Nielsen was later forced to leave the bank due to a separate scandal in which the lender was found to have misguided investment clients.

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