To date, EFRI represents more than 910 European consumers who have been ripped off by investment scams, stealing EUR 49,8 Mio of their lifetime savings. The harm done to hundreds of thousands of European consumers – mainly elderly people – during the past years by investment and boiler room scams is nothing short of shocking. Massive financial losses, psychological distress and mental illness result from such an experience. Unsuspecting European consumers lose their life-time savings to scrupulous international fraud organizations. EFRI tries to support victims to get some justice.
The operators of boiler scams need European payment service providers (banks and legal and illegal payment service providers/FinTechs/PSPs) to transfer the stolen money to offshore bank accounts under their control. EFRI is heavily convinced that without these willingfully acting European PSPs the fraud going on in Europe could not be possible at this scale. Our research on the fraudulent PSPs is based on our members’ (a/k/a victims) payment vouchers as well as the findings in different criminal and civil investigations in Europe. So we identify those European banks, PSPs and acquiring organizations most intensively used by the scammers.
Based on this research we found that Kobenhavn Andelskasse – a small Danish bank – was more or less involved in about each boiler room scam and – as we learned only recently – also in quite a lot gambling and gaming scams in 2017 to 2018. As a matter of fact, no other European bank showed up in so many different investment scams. We realized that Kobenhavn Andelskasse (a/k/a Copenhagen Cooperative Fund or KBH Andelskasse) and its ultimate beneficial owners (UBO) not only facilitated the transfer of the stolen money to the scammers and but also offered its services as a service provider for enabling the scammers to do minor refunds to the victims without leaving a trace to them.
How a bank got hijacked by scammers.
Being one of the smallest Danish banks did not prevent Kobenhavn Andelskasse to support illicit businesses and thus caused harm to hundreds if not thousands of unsuspecting European consumers.
The venture from being an almost bankrupt unknown Danish cooperative bank to develop into a massive cybercrime facilitating European money laundering hub started in or around 2014 and could be a script for a Netflix serial.
- 2012 Kobenhavn Andelskasse starts to be on the FSA Watchlist
- 2014 – directors have to leave the bank and an insolvency scenario of the cooperative bank is looming
- 2014 – Bail-out investment of Dansk OTC and Jesper BAK
- December 2015/16 FSA audit uncovers compliance, risk deficiencies and massive conflicts of interests issues
- April 2016 – Resignation of Jesper BAK as chairman
- June 2016 – Voting rights of Dansk OTC group deprived by FSA
- Autumn 2016 – except for one board member, all board members resigned (on request of the Danish FSA)
- Autumn 2016 – Wael Almaree joins as a beneficial owner vis WN International Group Aps
- Spring 2017 – Clearhaus, a Danish Fintech, acquires 33% of the bank
- April/May 2018 – Clearhaus sells its shares to companies controlled by Wael Almaree without approval of FSA
- April 2018 – British FinTech expert and Wael Almaree confident Robert Courtneidge gets appointed as director
- April/Mai 2018 – FSA deprives voting rights of the new owners and starts again audits
- August 2018 – Criminal complaint against Clearhaus employees filed
- August 2018 – massive money laundering issues get revealed
- September 2018 – Kobenhavn Andelskasse was switched into liquidation mode by FSA
The Bail-out and repositioning.
Since 2012, KBH Andelskasse was on the watchlist of the Danish Financial Supervisory Authority (FSA) for risky and non-compliant business decisions. Finally, in spring 2014, the bank’s board was dismissed while the bank became illiquid and headed toward bankruptcy. This was when Dansk OTC stepped in.
The Danish investors and capital market expert Jesper BAK and his college Dag Kaj SCHENBERG injected DKK 21,000,000 (paid in cash) via their legal entity Dansk OTC to bail-out the bank from its doom scenario. Until then, the bank was supposed to provide retail banking products and distribute pensions, insurance, and investment funds products. As with any other cooperative bank, it was owned by its customers who became members of the cooperative.
With the investment, Dansk OTC became a qualified owner in Kobenhavn Andelskasse (it was the first time that Kobenhavn Andelskasse had owners with qualified ownership interests). Jesper BAK became the chairman of the board of directors joined by Hans Christian Hansen and Erik Bent Hansen as of May 3, 2014. The new owners soon decided to change the business model and transformed the bank to serve their interests.
When the Danish FSA started to intervene.
In December 2015 and January 2016, the FSA audited Kobenhavn Andelskasse and uncovered severe deficiencies in the risk and compliance standards, as well as material conflicts of interest in the bank’s day-to-day operation. The audit finally resulted in the not-so-voluntary resignation of all but one board member as they were not deemed fit and proper. They did not meet the requirements of the suitability of members of the management body and key function holders for banks under Directive 2013/36/EU and Directive 2014/65/EU.
Jesper BAK resigned in April 2016. While FSA has concluded its audit of Kobenhavn Andelskasse in spring 2016, the Danish prosecutor launched a criminal investigation against him and Dag Kaj SCHENBERG for insider trading and market manipulation. It was not the first time Jasper BAK had troubles with the law. In 1998, he already was found guilty of market manipulation, and was sentenced to jail time. That said, it’s fair to assume that he was not fit and proper at the time when he became a qualified owner and chairman of Kobenhavn Andelskasse.
Københavns Andelskasse received several orders to rectify these matters and ensure that a future board of cirectors and the Executive Board would have the required knowledge and personal integrity to run Københavns Andelskasse in a compliant way.
In June 2016, FSA decided to abolish the voting rights directly and indirectly associated with Jesper BAK .
Gamification & Scammification.
Forcing the management board to leave and to deprive its beneficial owner Jasper BAK of voting rights did not really change the fate of Kobenhavn Andelskasse. On the contrary, things started to get worse. In or around autumn 2016, the well-known gambling entrepreneur and investor Wael Sulaiman ALMAREE joined the bank as a new beneficial owner holding the investment in Kobenhavn Andelskasse via his WN International Group ApS, a freshly squeezed Danish legal entity.
Wael Sulaiman ALMAREE became one of the bank’s beneficial owners and started to change the bank’s business and to give the bank the final fatal blow. He and Clearhaus A/S (see below) opened the bank for international customers thereby initiating the high-risk business segment, focusing on gambling and scam businesses’ facilitation.
The Danish Fintech Clearhaus A/S acquired 33% of the shares of Kobenhavn Andelskasse in spring 2017 which was worth some EUR 10 mio back then. Clearhaus had historically a close business relationship with Dansk OTC and Jesper BAK. In September 2015, Dansk OTC brokered a $3.2 mio investment for Clearhaus A/S. In April 2017 the FinTech argued that together with Kobenhavn Andelskasse they could develop a solution that integrates traditional banking and so-called “acquiring business.” This would enable them to address the needs of e-commerce companies (merchants). “Our interest is in closing the gap between traditional banking and acquiring. Clients will be able to see where they stand banking-wise without delay based on their transaction activity”.
Clearhaus A/S actually initiated and coordinated a massive inflow of international payments to Kobenhavn Andelskasse, mainly coming from its acquiring business for gaming and gambling customers from Norway, Turkey, France.
WN International Group A/S on the other hand also initiated and coordinated new international customers – actually companies set up by themselves – to sign up with Kobenhavn Andelskasse bringing lots of dirty money from hundreds of boiler room scams to the small Danish bank and organizing the flow out to the scammers.
In May 2018, Clearhaus informed the Danish FSA about the sale of its shareholdings to their fellow shareholder WN International Group ApS (sole owner Wael ALMAREE resp. his British company) and to ACEA Capital A/S (Wael ALMAREE ownes supposingly 15-19.99% of this company) with the Moldavian Wael ALMAREE finallybecoming the controlling beneficial owner with estimated holdings of more than 35% of an European bank.
The new owners appointed Robert COURTNEIDGE – a well-known British FinTech pioneer (OneCoin advisor, ex-ePayments System director) as a director of Kobenhavn Andelskasse in April 2018.
The final act.
In August 2018, the bank reported employees of the former shareholder Clearhaus A/S to the police for alleged fraud and violation of the Money Laundering Act.
Actually, the FSA never approved ACEA Capital A/S and WN International Group Aps as the bank’s beneficial owners, and thus they were deprived of their voting rights.
The initiated FSA investigations revealed massive money laundering issues. From October 2017 to September 2018 alone, the cash inflow totaled more than EUR 550M (some DKK 4,1B) in foreign customers’ accounts. A similar amount was sent out of the bank during the same period. In these 12 months alone, 183 foreign customers – all more or less related to the then-owners of KBH Andelskasse triggered a total of 1645 money laundering alarms without any actions have been undertaken. For more about this, read here and here on Fintelegram.
As of 13 September 2018, Kobenhavn Andelskasse was closed for gross and systematic violations of the compliance framework and AML directives. The disgraced bank was taken over by Finansiel Stabilitet to be wounded up. Besides, the FSA filed money laundering complaints with the Danish prosecutor. Also, civil charges were filed.
EFRI knows some of the 183 “foreign customers” of KHB Andelskasse quite well as do hundreds of victims out there. A lot EFRI members transferred money to various scams via Moorwand Ltd and UPC Consulting, Get Financial Services Ltd,… and their bank accounts with KBH Andelskasse.
We decided already in summer 2019 to go for damages and filed respective money laundering and accomplices complaints with the responsible Danish authorities along with fund recovery claims. We will hold the former management board as well as the owners accountable for their role in facilitating scams.
Stay tuned for Part II of this story.