'Troika Laundromat' Russia money laundering scandal clobbers more banks as allegations deepen

Flickr / David Lytle

The "laundromat" scandal is deepening.

• The revelations of a massive money laundering operation linking Russian money to Western companies and financial institutions is widening to include more European banks.

• ING is the latest lender to be named in relation to the "laundromat," as the Organized Crime and Corruption Reporting Project drips out its findings in cooperation with various media outlets.
• Raiffeisen shares are down 1.2% Wednesday having dropped as much as 14% on Tuesday. ING shares are down around 4%.
• "We take all signals of this kind, many from years ago, very seriously," ING said.

The revelations of a massive money laundering operation, linking Russian money to Western companies and financial institutions, is widening to include more European banks.

The "Troika Laundromat" scheme, uncovered by the Organized Crime and Corruption Reporting Project (OCCRP) and Lithuanian news site 15min.lt., allowed the flow of some $4.8 billion of funds from Russian companies and figures into Europe and the US between 2003 and early 2013.

The project found that the scheme originated at what was then Russia's largest private investment bank, Troika Dialog.

ING, one of the largest banks in The Netherlands, is the latest lender to be named in relation to the "laundromat" as the OCCRP drips out its findings in cooperation with various media outlets. The lender's shares dropped more than 4% after Dutch paper Trouw reported that hundreds of millions in suspicious euros were funneled through ING's Russian operations.

The media reports named a number of other lenders with suspicious accounts or links to Russia (Bloomberg has a handy list), including Nordea, Swedbank, ABN Amro, Rabobank, and Danske Bank (which is already ensnared in a money laundering scandal involving Russian funds).

Dankse Bank, alongside Lithuanian lender Ukio Bankas, processed payments through Austrian accounts worth around $967 million, according to Hermitage Capital Management via the OOCRP.

Read more: An explosive exposé of a $9 billion Russian money-laundering operation entangles Citigroup, Raiffeisen, and Deutsche Bank

Nordea, Swedbank, ABN Amro, Rabobank, and Danske Bank didn't immediately respond to requests for comment on Wednesday.

"We take all signals of this kind, many from years ago, very seriously as we have been doing over the past years, especially in the context of our Know Your Customer (KYC) enhancement programme," ING spokesman Raymond Vermeulen said in a statement to Business Insider.

ING had already paid a €775 million ($875 million) fine last year following a Dutch investigation which found criminals had been able to launder money through its accounts for several years.

Raiffeisen Bank was hit by the scandal when information was first disclosed by newspapers including The Guardian, with its shares dropping as much as 14% on Tuesday. The Austrian lender has a large presence in Russia, and its shares are down 1.2% on Wednesday.

Raiffeisen, in a comment to Business Insider after the revelations on Tuesday, said it was conducting an internal investigation and "complies with all anti-money laundering requirements."

Deutsche Bank - already plagued by controversies - has also been impacted, with more than $889 million allegedly moving through the bank's accounts to those of the so-called "Troika Laundromat," according to German publication Süddeutsche Zeitung.

Deutsche Bank declined to comment beyond a statement on Tuesday in response to the allegations. It said: "Deutsche Bank's clients are so-called respondent banks. It is first and foremost the task of the respondent bank to check its customers in accordance with the applicable know-your-customer regulations."