Thomas Borgen, chief executive officer of Danske Bank A/S, pauses during a news conference in Copenhagen, Denmark, on Wednesday, Sept. 19, 2018. Borgen will step down amid allegations his

bank was at the center of a major European money laundering scandal with as much as $234 billion flowing through a tiny unit in Estonia.  Freya Ingrid Morales | Bloomberg | Getty Images The

popularity of Scandi noir rests on the contrast between the banal surface of Nordic societies and the nefarious activities underneath. An internal report into potential money laundering

through Denmark's largest bank by assets – accompanied by the immediate resignation of appropriately named chief executive Thomas Borgen – has provided the latest must-watch

suspicious – meaning they displayed obvious red flags such as sharing addresses with other entities regarded as suspect, or suddenly yielded unexplained large payments. CONTEXT NEWS Danske

Bank said on Sept. 19 that Chief Executive Thomas Borgen has resigned due to a scandal related to past potential money laundering through its Estonian branch. He will continue in his job

until a replacement is found, the bank said. "It is clear that Danske Bank has failed to live up to its responsibility in the case of possible money laundering in Estonia. I deeply

regret this," Borgen said in a statement released by the bank. The bank also lowered its expectations for annual net profit to 16 billion-17 billion Danish crowns from 18 billion-20

billion Danish crowns. An internal probe identified 200 billion euros in payments made through its Estonia subsidiary from 2007-2015, a "large part" of which were suspicious and an

unknown number of which constituted money laundering, the bank said. Danske shares fell by 4.43 percent to 167.10 Danish crowns by 0800 GMT on Sept. 19. Danske will struggle to convince

anyone it was completely oblivious. Warning lights on its Estonian branch, which it had acquired by taking over Finland's Sampo Bank, were flashed by the local regulator and even the

Russian central bank as far back as 2007. Plans to migrate the Baltic banking activities onto Danske's main IT systems were binned as too expensive – even though the dodgy

"non-resident portfolio" often generated over two-thirds of the Estonian division's annual pre-tax profit and in 2011 Estonia generated 10 percent of overall group pre-tax

profit. Over a fifth of incoming funds were from Russia. Danske's main problem now is that with a good portion of the suspicious payments made in dollars, it is virtually guaranteed

aggressive pushback from the United States. Worse, it can't be sure how bad the problem really is. In the most extreme scenario, assuming all the transactions were laundered funds and

scaling fines imposed on Deutsche Bank and BNP Paribas proportionately, the fine could hit 53 billion Danish crowns ($8.3 billion), analysts at Jyske Bank reckon. But that assumed the number

of dodgy transactions amounted to around $150 billion rather than $230 billion. Danske has one thing bang on. Unlike BNP Paribas, whose chair Baudouin Prot only left after it had swallowed

a $9 billion U.S. fine for sanctions-busting, heads have rolled pre-emptively. Even so, as head of international banking activities before stepping up to CEO in 2013, Borgen would have had

to go anyway. Danske should ready itself for a nasty denouement. MORE FROM _BREAKINGVIEWS_: ELLIOTT FLEXES ITS TWO BIGGEST MUSCLES AT SEMPRA INVESTORS CAN IGNORE GLIMMERS OF CHINA TRADE HOPE

UK $2 BLN FINTECH STAR RISKS PUBLIC-MARKET CURSE _Commentary by Christopher Thompson, a Breaking Columnist at Breakingviews. Follow him on Twitter_ @CGAThompson_._ _FOR MORE INSIGHT FROM

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