The United States of America and the Federal Retirement Thrift Investment Board (FRTIB) have filed a lawsuit against Danske Bank (DANSKE.CO) and its former CEO in the Copenhagen city court, according to the attorney representing the parties.
Shares in Danske Bank (DANSKE.CO) fell around 8% after the news, which was first reported by the business daily Borsen.
The suit is linked to Danske’s involvement in a major money laundering scandal, according to Borsen.
It said the parties were initially claiming compensation of 10 million Danish crowns ($1.62 million), but that the number could rise to hundreds of millions.
Between 2007 and 2015, 200 billion euros ($235 billion) in transactions were channelled through its small branch in Estonia, many of which the bank has said were suspicious.
The Federal Retirement Thrift Investment Board (FRTIB), which manages almost $600 billion in federal retirement funds, lost money after buying shares in Danske Bank, according to Borsen.
The bank faces several similar civil lawsuits, with total claims amounting to 12.4 billion Danish crowns ($2 billion) at the end of last year, according to the bank’s annual report.
“We will update any potential development on a quarterly basis, however, the sum of claims does not deviate materially from already disclosed numbers,” Danske said in a statement on Tuesday following the news.
“Danske Bank intends to defend itself against these claims. The timing of completion of any such lawsuits and their outcome are uncertain,” it added.
A spokesman for the Danish bank could not confirm or deny the lawsuit.
Thomas Donatzky, the lawyer representing the claimants, confirmed the lawsuit when contacted by Reuters, but declined to give further details.
Officials from for the U.S. Department of Justice (DOJ) and FRTIB did not immediately respond to a request for comment.
Danske’s former CEO Thomas Borgen’s lawyer Peter Schradieck declined to comment. Borgen left Danske in 2018 in the wake of the money-laundering scandal.
Danske Bank is also being investigated by the DOJ over its role in the Estonia case.
Shares in Danske closed 7.6% lower at 111.45 crowns each, the lowest level in two months.
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