While there are of course cases where Bitcoin has been used for such nefarious activities, the suggestion that this phenomenon is unique to cryptocurrency is absurd, a point that was emphasized yesterday when more details emerged about how the Estonian branch of Danske Bank used gold to launder over $223 billion over a staggering eight-year period.
Danske Bank’s Dirty Gold Secret
It has been known since 2018 that Danske Bank was involved in money laundering, but fresh details of the scam are just now coming to the surface. This includes Bloomberg yesterday revealing that, at the height of its criminal activity, the Estonian branch started offering gold bars to wealthy clients in order to help them keep their fortunes hidden, which is quite a service, even for a branch that was already wiring billions of client dollars to offshore accounts.
This service was offered to a select group of customers, mostly from Russia, who were also told that they could convert their money into gold bars and coins should they wish. Documents from 2012, including an internal presentation, show how Danske pitched gold as a means for clients to achieve “anonymity” while also ensuring “portability” of their assets. When the scandal initially blew open in late 2018, the sale of gold bars was not listed among the services it offered to clients, suggesting it wanted to keep this practice hidden.
Service “Against all Anti-money Laundering Laws”
Attesting to the seriousness of the crime, Bloomberg cites Jakob Dedenroth Bernhoft, a Danish lawyer who specializes in compliance and money laundering, who says that the service was “against all anti money-laundering laws” and was “definitely suspicious.”
Danske Bank is being investigated in the US and in Europe for its activities, and has had numerous class-action lawsuits brought against it. Thomas Borgen, the former CEO, and many other former directors is also are under preliminary criminal investigation in Denmark.
In September, Reuters revealed that at least $50 million worth of gold currently in the system is fake, and is providing a useful stream of income for “narcotics dealers and warlords”, further damaging the claims from gold bugs that it is superior to Bitcoin.