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US investor files class-action suit against Danske Bank, former execs


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US investor files class-action suit against Danske Bank, former execs

A class-action lawsuit has been filed in the U.S. against Danske Bank A/S and four former executives after they allegedly provided false and misleading information about the bank's businesses and operations.

The case was filed in New York by an institutional investor of the Copenhagen-based lender on behalf of investors who bought American depositary receipts between Jan. 9, 2014, and Oct. 23, 2018.

The complainants alleged that the bank failed to inform them of widespread illicit activities in its Estonian branch through at least March 2016, that the money laundering activities had been flagged by a whistleblower, that the bank had been probed by the Danish Financial Supervisory Authority, and other developments in the lender's €200 billion money laundering affair.

Robbins Geller Rudman & Dowd LLP, the law firm representing the complainant, said the ADRs traded at "artificially inflated prices of more than $20 each," with the information being withheld. When the news of the scandal broke and investors learned of its gravity, the market price of the ADRs fell to as low as $9.50 each, losing more than $2.54 billion in market capitalization, the law firm added.

The case also involves Thomas Borgen and Ole Andersen, Danske Bank's former CEO and chairman, respectively, and two former CFOs, Reuters reported.

The complainants are seeking to recover the damages they incurred during the time period covered by the suit.

Danske Bank is also facing regulatory actions from all over the world. It is yet to make provisions for possible fines that may arise from the scandal, although it was previously estimated that fines could reach billions.