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Danske Bank to pay up to DKK100m to 900 customers

Follows similar incident which saw it reported to the Danish police

The beleaguered bank is to pay more compensation to customers after it failed to inform them about an expected negative return for an investment product called Danske Porteføljepleje.

A statement on 4 September confirmed that Danske Bank expects to pay between DKK80m and DKK100m (€13.4m) to roughly 900 customers.

Director of private banking Denmark Bente Nielsen commented: “Our review show that around 900 customers did not receive sufficient information about the expected negative net returns in the affected low-risk strategies.

“We apologise for this and, of course, will compensate the affected customers.”

Danske Bank is in the process of calculating individual customer compensation and clarifying any tax consequences.

History repeats itself

Danske Bank conducted a review of its products after the Flexinvest Fri case, which saw it reported to the police.

In 2017, the bank became aware that that a very large proportion of its customers could expect negative returns, but they were not informed.

The bank also continued to sell the respective investment strategies in Flexinvest Fri to new customers, who were also not made aware they would make a loss.

This is the latest blow to the Danish bank, which has also been under intense scrutiny for serious anti-money laundering failures at its Estonian branch.

In March, it was reported that the former chief executive of the bank, Thomas Gorgen, is also the target of a legal complaint filed by a Belgian firm on behalf 72 legal entities, representing 155 institutional investors.

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