Anyone who purchased Danske Bank American Depository Receipts (ADRs) between January 6, 2014, and October 23, 2018.
What’s Going On?
It’s believed that Danske Bank shareholders lost money – a total of about $2.54 billion in market capitalization – when it was discovered that the bank was engaged in illegal money laundering activities at its Estonia branch between at least 2012 and March 2016.
Can This Money Be Recovered?
A class action lawsuit is seeking to help investors recover the money they may have lost in securities.
A class action lawsuit has been filed to help Danske Bank shareholders recover money they may have lost in securities when the bank’s illegal money laundering scandal was discovered.
Danske Bank Money Laundering Scandal
According to the class action lawsuit, Danske Bank hid from investors that it had been facilitating money laundering linked to Russia through its Estonian bank branch between 2012 and March 2016.
It’s believed that the bank knew about the suspicious activity since at least December 2013, when a whistleblower allegedly alerted the company’s senior executives. In 2014, Danish financial regulators opened an investigation into the possible misconduct at the Estonian branch, the lawsuit says, and sent Danske Bank “a scathing 340-page report” that the bank apparently didn’t even translate for three years.
In the meantime, the value of Danske Bank’s securities continued to rise as the bank was able to obtain several corporate debt rating increases that enabled it to raise hundreds of millions of dollars by issuing and selling bonds in the European bond markets. Danske Bank, according to the lawsuit, misleadingly attributed its success to “ongoing operational and strategic prowess” rather than the illegal money laundering activity happening at its Estonia branch.
Throughout this timeline, shareholders allegedly remained unaware of the illicit activities and purchased securities at inflated prices.
Stock Prices Plummet When the Truth is Revealed
Between September 2017 and October 23, 2018, the lawsuit says, the market began to learn of the illicit activities that allowed Danske Bank to profit and the resulting regulatory action that would be taken against it, including potentially billions of dollars in fines and penalties imposed by regulators in five different countries.
As a result of these revelations, the value of Danske Bank securities began to plummet, causing shareholders to lose approximately $2.54 billion in market capitalization.
Do Shareholders Have Any Recourse?
Attorneys have filed a putative class action lawsuit that may be able to recover money shareholders lost as a result of Danske Bank’s actions.