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Prosecutors Charge Ex-Danske Bank CEO in Money-Laundering Case

By GAN Integrity

Welcome to This Week In Compliance: GAN’s weekly news roundup, where we curate the latest stories on compliance and anti-corruption to keep you informed. This week we cover the conviction of Danske Bank's ex-CEO in a money laundering case. Keep reading for this breaking story and find more news below:

Top Story

Prosecutors Charge Ex-Danske Bank CEO in Money-Laundering Case: 

Danish economic crime prosecutors charged Thomas Borgen, Danske Bank’s former chief executive, in connection to the EUR 200 billion money-laundering scandal. Borgen is the first senior manager of Danske to be charged in the case. He was reportedly hit with a charge of failure to prevent certain transactions. Danske Bank has previously been indicted in Denmark and is facing a criminal investigation in the U.S. Borgen announced his resignation in September last year, but was ultimately ousted a few weeks later before a successor had been even been appointed. Danske’s share price has been cut in half over the past year and analysts have estimated that the bank could face totalling multiple billions of dollars.

Policy Updates

U.S. Treasury Department publishes sanctions compliance guidelines:

The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) published its own guidance last week on creating a compliance program to abide by the U.S. sanctions regime. OFAC said that guidance could potentially lead to reduced penalties for companies in sanctions cases. The office says in the guidance that, among others, it will consider whether an accessible program is in place that “captures the organisation’s day-to-day operations” at the time a sanctions violation occurs. OFAC has been emphasizing the positive and negative aspects of a company’s remediation efforts in recent decision notes. The release of formal guidance puts companies on notice that their program is likely to be found lacking in case it does not contain the elements in the guidance.


U.S. CFTC issues 'enhanced' whistleblower award:

The U.S. Commodity Futures Trading Commission (CFTC) granted an “enhanced” award of USD 1.5 million to a whistleblower who initially tried to report the problem internally before involving the CFTC. The commission said the whistleblower provided ‘original information’ that helped the agency understand a “complex scheme” and interviews with witnesses about the scheme. The whistleblower was paid an ‘enhanced’ award for first attempting to report his/her concerns internally. The CFTC has awarded over USD 85 million to whistleblowers since issuing the first award in 2014.

Deutsche Bank accused of bribery in lawsuit:

Deutsche Bank is being sued in London court by Stichting Vestia, an affordable housing corporation from the Netherlands which nearly collapsed due to derivative losses. Vestia is accusing Deutsche of paying EUR 3.5 million in commissions to a Dutch company called First in Finance Alternatives; roughly EUR 1.75 million of that amount went to Vestia's treasury and control manager Marcel de Vries, who was solely in charge of Vestia's derivative trading. Vestia is accusing Deutsche of "wining and dining and entertaining him to an excessive degree". De Vries and Arjan Greeven, an intermediary, were convicted of bribery in the Netherlands last year. Deutsche hit back by calling the lawsuit a "strained and unsustainable attempt [...] to recover the losses on its derivatives by any means, including by creating a fallacious link between those losses and the separate matter of FIFA's bribery of Mr. De Vries."

Walmart pays audit committee extra for FCPA investigation:

Retail giant Walmart said in a SEC that it is paying the chair of its audit committee an additional USD 90,000 in compensation because of the workload of its ongoing FCPA investigation. Other members of the board’s audit committee are receiving USD 45,000 in additional compensation each. Walmart started paying its audit committee more last year. The company has faced an ongoing FCPA investigation since December 2011 over allegations that the company violated the statute by paying bribes in Mexico, Brazil, China, and India, among others.


Peru's former president Humala and his wife indicted in Odebrecht case:

Relating to the Odebrecht corruption scandal, Peru’s public prosecutor this week indicted Peru’s ex-president Ollanta Humala and his wife Nadine Heredia. The pair are charged with “the leading of a criminal organization to launder assets”. Both are accused of having received USD 3 million from Odebrecht which were used in Humala’s electoral campaign which eventually resulted in his election in 2011. Two other former Peruvian presidents are currently charged as part of the Odebrecht scandal. In April, a third ex-president died after committing suicide shortly before his arrest for money laundering during his time as president.

Brazil's former president Temer ordered back to jail in corruption probe:

On Wednesday, a Brazilian court ordered that former president Michel Temer be jailed again. Temer has been charged in several corruption investigations, with this court order also relating to an investigation into corruption allegations. Temer has maintained his innocence in all corruption charges. He told reporters he would turn himself in the day after the court order was issued.

Guatemalan presidential candidate, lawmakers, and cabinet minister to be probed over graft:

An investigation into a presidential candidate, six lawmakers, and a cabinet minister was launched Monday by Guatemalan prosecutors. In a statement, UN-backed International Commission Against Impunity (CICIG) and the Guatemalan attorney general’s office said the eight individuals in question, all belonging to the Patriot Party, were responsible for the approval and distribution of bribes worth USD 7.5 million to 62 deputies. Bribes were used to get approval for certain laws and judicial appointments between 2012 and 2015. Economy Minister Acisclo Valladares is also investigated in relation to the case.

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