Could Icelandic justice be in view?

This latest development in Iceland relates to Kaupthing.

The Special Prosecutor has filed charges against Kaupthing's CEO Hreidar Mar Sigurdsson, Chairman Sigurdur Einarsson, Kaupthing Luxembourg manager Magnus Gudmundsson and the second largest shareholder in Kaupthing Olafur Olafsson.

See here: http://www.icelandreview.com/icelandreview/daily_news/Kaupthing%E2%80%99...

and Sigrun's initial comments on her blog here:
http://uti.is/2012/02/osp-brings-charges-in-the-al-thani-case/

Sigrun reports: "They are all charged with market manipulation. Sigurdsson and Einarsson are seen as the organisers and are in addition charged with breach of fiduciary duty. Olafsson and Gudmundsson are charged for participation in this breach and Olafsson is in addition charged for money laundering."

Of course they are all aboad and all deny the charges.

Interesting blog from Sigrun Davidsdottir on the verdict reported here:
http://chat.ksfiomdepositors.org/news-item/icelander-gets-prison-insider...

Selected extracts below - but the whole is worth a read:
http://uti.is/2012/02/baldur-the-blame-game-and-the-flat-screen-theory-o...

"The first Supreme Court ruling in a case of insider trading in Iceland has constituted a clear example: the gain was ISK192m, €1.2m, the sentence is two years imprisonment. There are two fundamentally significant aspects of this case: it’s the first Supreme Court ruling in a case brought by the Office of the Special Prosecutor – and the man found guilty, Baldur Gudlaugsson (b. 1946), is not one of the thirty or so major players in the collapse of the Icelandic banks but a former permanent secretary (a civil servant) at the Ministry of Finance. ...

... At the moment, the question of blame is widely debated in Iceland – and the ruling in Gudlaugsson’s case leads to the sarcastic remark, often heard since the District Court ruling, that one civil servant, who made a profit of ISK192m, may be the only person to be sent to prison for criminal acts connected to the collapse of the banks. A scapegoat for the infamous thirty who many Icelanders do blame for these events. – It’s an untimely remark: it’s still far too early to tell what the outcome of the present and coming OPS cases will be.

Apart from Gudlaugsson’s case, the debate on blame falls into two categories: there is what could be called the “Flat-Screen Theory of Blame” – and then the theory, according to which the OSP is working, that alleged crimes are committed by certain individuals. Suspicion of criminal doings should lead to an investigation and, depending on the outcome of the investigation, charges should be brought.

The “Flat-Screen Theory” draws its name from an interview with Bjorgolfur Gudmundsson, who together with his son Bjorgolfur Thor, owned 42% of Landsbanki at the time of its collapse.* In the interview, published a few months after the events of October 2008, Gudmundsson pointed out that Icelanders had lived beyond their means, the number of flat-screens sold in Iceland being a case in point. The core of this theory is that everyone is to blame. Jon Asgeir Johannesson recently aired the same idea – no single person did anything wrong or is to blame; in his version, the collapse seemed like a natural disaster. What happened in Iceland, according to the “Flat-Screen Theory,” was a sort of collective madness that ended in a collective collapse. ... "

Sigrun concludes:

"It’s fair to say that there is a battle raging in Iceland between the “Flat-Screen” theorists and those who think investigations are necessary in order to show that crime doesn’t pay. That battle is fought over who gets to interpret the past. Those who eventually manage to shape the Icelanders’ understanding of events and circumstances up to October 2008 will come to own the present – and eventually the political and financial future of Iceland. "

I note from today's MailOnline that Robert Tchenguiz "the largest shareholder of Kaupthing " who borrowed GBP 1.7billion from Kaupthing is in the process of selling a huge portfolio of property to raise GBP 3billion to clear debts of GBP 2billion ( sorry I've used GBP my computer doesn't have the standard pound sign ).

Has this report got any significance for recovery of the GBP1.7billion by Kaupthing ( presumably Kaupthing hf of Iceland ) and hence assist us to recover our money under the parental guarantee ?

D RAM

"Iceland pre-and post-collapse: Splitting apart debt and assets – and the lost sense of honour to pay one’s debt"

Another excellent blog by Sigrun. Recommended reading - not for the faint-hearted:

http://uti.is/2012/01/splitting-debt-and-assets-apart-and-the-lost-sense...

Selected extracts (but you should read it all):

"... But before it comes to bankruptcy, there are ways to siphon assets off. This was done in the Iceland – not only in the banks but also in the smaller financial institutions such as the building societies. The basic way is to use a cluster of companies as a centrifuge where, in the course of a few years, debt and asset is split apart: the debt stays in certain companies, the assets migrate elsewhere. When things go badly, the debt-ridden companies go bankrupt, little or nothing is left for the creditors whereas assets, bought with the help of loans, have been spirited away. ..."

"...In addition, the Icelandic lenders lent exorbitant amount of money into holding companies such as FL Group, Exista, Samson, Baugur and Milestone, which in turn lent the money on to related parties, paid out dividends or did in other ways split apart debt and assets. By lending money into these holding companies, the companies turned into banks with no risk management.
The three main banks in Iceland all lent to big borrowers who used these methods. ..."

" ... Once money has been channelled out of sight and reach of WUBs and authorities such as tax authorities it isn’t trivial to get the money back into the country of origin, let’s say Ireland or Iceland. ..."

Good to hear that Iceland is taking an apparently vigorous approach and seeking return of funds from those who mismanaged/looted Kaupthing hf but has there been any similar attempts by the UK and IOM authorities as regards KSF(UK) and KSF(IOM) ? There was news previously of investigations but have these resulted in even a single person been prosecuted or sued for return of ill gotten gains ?

Thought not,

D RAM

Hi Anrigaut,

Once more can I than you for these pieces of information, that help to fill in many of the gaps that I have re these parts of the Investigations, that are happening in Iceland and elsewhere.

Yourself, Glen07 and a few others have done fantastic work on our behalf over the past 3 years and I certainly appreciate it. Your thoroughness and perseverance on behalf of us all is way beyond belief - and I thank you sincerely. And you do come to my aid answering questions that I might flounder with, and also give me information that helps my investigations and estimates when updating my tables.

Others also include Icecrusher with his sharp mind and thoughts, and hopefully between us all, we cover most of the arena surrounding the KSFIOM situation.

I see some of us who still remain, seem despondent that more than 3 years on we have still not yet reached the end - liquidation finalised - but it always (seemed to me anyway) that it could take 7-10 years before it all finished. Hopefully now it might just be finished by Dec 2014 (another guess). And we must stay positive - 83.2% back (of sorts) and hopefully another 10-13% within 17 months. and maybe just that 100%+ by Dec 2014. So it could be so much more worse than it is.

Anyway, thanks once more and keep updating when and where you can,

Gordon 45