Kaupthing

Ingvar Vilhjalmsson, the former director of the market trade division at Iceland’s (now bankrupt) Kaupthing Bank, now needs to repay the bank’s estate around ISK 2.6 billion (EUR 16.36 million) in loans which had effectively been written off.

Vilhjalmsson took the massive loans in the years running up to Kaupthing’s demise in order to buy shares in the bank. The Reykjavik District Court yesterday ruled that he must pay the money back. ...

Sigrun Davidsdottir's latest blog, with comment added by Tony Shearer:

"Once again, Sigrún, you have set things out very clearly. And the circumstances raise so many questions about the border between acceptable practice, naivety, incompetence, negligence, and criminal behaviour. And that applies to management, borrowers, auditors, regulators, and other advisers.
The authorities need to put into the public domain what happened so that the lessons can be learned, and people in the future will know what is, and is not, acceptable practice and behaviour.
In addition those who lost money as a result deserve to have some explanations.
Tony Shearer"

Quite so Tony!

The former chief executive of the collapsed Icelandic bank Kaupthing has been arrested, authorities say.

Hreidar Mar Sigurdsson is suspected of embezzlement, trading irregularities, and other breaches of banking laws, the special prosecutor's office has said.

It is the first high-profile arrest since the country's financial collapse in 2008.

Iceland has agreed to hand creditors of failed bank Glitnir a 95 percent stake in smaller lender Islandsbanki in payment for losses suffered in last year's banking sector collapse.

Iceland's top commercial banks were brought down by the global financial crisis last October, plunging the Icelandic economy into deep recession and forcing the nation to seek billions of dollars in aid from the International Monetary Fund and other lenders.

Iceland's three biggest banks -- Glitnir, Landsbanki and Kaupthing -- folded within a week a year ago this month, owing more than $60 billion to foreign lenders, and both Landsbanki and Kaupthing have yet to reach agreements with their creditors.

The full story :

On 8 October last year, thousands of Brits saw their world come crashing down when Iceland's biggest bank collapsed, apparently taking their life savings with it.

One year on, they are still anxiously awaiting news of when, or if, they will get back the bulk of their money.

A few days after Kaupthing's demise, Money talked to some of these "forgotten Brits". They included Dr Tom Bailey, a wildlife vet working at a falcon hospital in Dubai, pictured here with his teacher wife Theri, and their children Hannah, six, and Malachi, eight.

They were the big losers after the Treasury seized control of Kaupthing Singer & Friedlander, a UK subsidiary of Kaupthing, which then went into meltdown. An estimated 10,000 British depositors had around £850m tied up in the subsidiary's Isle of Man arm, and lost access to this money.

Many of those affected are UK citizens who happen to be living abroad – development workers, teachers and the like.

Savers have started to receive a payout from the liquidator worth about 25% of their investment, with a second distribution "anticipated" in December.

This week, Money talked again to some of the victims of the debacle. Paul and Angela Cuthbert used to live in Grimsby but emigrated to Australia three years ago.

They had more than £400,000 in their account, money they were planning to use to build their own home. Last month's payout resulted in them getting about £100,000.

Paul, 37, who lives in Hervey Bay, Queensland, is far from confident they will get all their money back.

Stephen Thomas, 57, had lived and worked in Russia for 10 years. He and his wife and daughter were planning a move to the Cotswolds when the bank went under. As a result, the $722,500 (£450,000 today) in their account – money from the sale of a house and his consultancy business in Moscow – was effectively whipped away.

To date, £110,000 has been returned to them.

The Baileys had more than £100,000 in their account. They had been planning to buy a house in the Devon countryside. They are perhaps a little more fortunate than some, partly because the sum of money at stake is not quite as big, and partly because theirs is a joint account, which means they could get back £100,000 (two lots of the maximum £50,000 per person under the Isle of Man compensation scheme). They have so far had £10,000 each.

"Theoretically, we should get an extra £40,000 each [in the coming weeks], which would take us to receiving the compensation limit of £50,000 per person," says Dr Bailey, who is originally from Horsham, West Sussex.

That, he adds, would represent "about 80% of what we had".

KSFIOM failure 'unfortunate, isolated event'
International Investment| 04 Sep 2009 | 11:00
Sarah Griffiths

The Isle of Man has branded the failure of Kaupthing Singer & Friedlander IOM (KSFIOM) an “unfortunate, isolated event” as a grass-roots YouTube campaign against the jurisdiction grows.
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A plethora of anti-Isle of Man videos have sprung up on video website YouTube attracting nearly 19,000 viewers, since expat pensioner "Fleeced 2008", recorded an anti-Isle of Man video , first covered by International Investment, about one month ago.

The Serious Fraud Office is sending a team of investigators to Iceland to help "get to the bottom" of whether there were any criminal intentions in the country's collapsed banks, which had extensive links with London.

It follows meetings in London between Richard Alderman, director of the Serious Fraud Office, and Olafur Hauksson, Iceland's special prosecutor, about events leading to the failure of Kaupthing, Landsbanki and Glitnir.