DANSKE BANK executives ordered to appear in a Fuengirola Court over fraud allegations.
Two executives of the largest Danish bank, Danske Bank, have been ordered to appear before the Criminal Court 1 in Fuengirola in relation to two charges of swindle and misleading publicity.
It related to the case of Euan Armstrong, a Briton who was sold an equity release mortgage.
The bank’s employees, currently working from the Luxembourg branch office, are due to appear in Court on January 23 and are to be questioned by the Judge and the claimant’s legal representatives, Lawbird Legal Services.
The Court ruling has also ordered the legal representatives for Danske Bank International S.A. to appear in Court, on the same day, as a civilly responsible party’, inasmuch as corporations did not have criminal responsibility when the alleged fraud took place.
According to the writ filed by the claimant in 2011, Danske Bank convinced him in 2005 to mortgage his retirement home in Alhaurin El Grande (Málaga) to guarantee a loan that was directly invested in financial speculative investment transactions, in Luxembourg, without the capital ever coming to Spain.
The capital assurance promised interesting tax benefits compliant with Spanish laws in respect to inheritance and wealth taxes by reducing or eliminating the taxable value of the property, once the mortgage was registered against it.
According to Lawbird’s representative, Danske Bank even falsified the content of a tax report on the product prepared by KPMG, one of the largest professional services company, by interpreting its conclusions in an unlawful manner with the purpose of facilitating sales.
The news release points out that KPMG has deemed ‘false’ a statement made by Danske Bank in their promotional marketing whereby the former had approved the tax benefits, as well as a formal request by KPM to Danske Bank to cease the use of their name and the removal of any reference to them having given their blessing to the financial product.
The text makes reference to a recent ruling by the Spanish Tax Office that concluded that the so called equity release on Spanish property is not a valid scheme for lawful tax mitigation but tax fraud, and a criminal offence where the defrauded sum exceeds €120,000 per tax year.
An indictment has also been brought against Peter Staarup, former Danske Bank CEO, as head of the Danish company that is believed to have sold in Spain over 100 capital assurance equity release mortgage loans worth tens of millions.