Could Icelandic justice be in view?

  • anrigaut
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Posted: Fri, 20/01/2012 - 22:31

Recent weeks have seen some hopeful (to me at least) signs that the long-awaited day of reckoning may perhaps at last be approaching for the Viking pirates who enriched themselves hugely through the casino banks funded by our money and then siphoned off as much as they could in the dying days (or even in what should have been the dead days), leaving the likes of us to take the rap. Can we dare to hope that the major perpetrators will one day be punished and feel some of the pain they inflicted on others by their apparently unbounded and thoughtless (Kaupthinking) greed?

The Winding-up Boards of all three collapsed Icelandic banks appear to be going after managers and executives with punishing law-suits which, if successful, could help fill the coffers for the benefit of creditors. In the case of Kaupthing, we stand to gain some financial benefit from any successful actions (through both KSFUK's claim against K hf and our parental guarantee). And even if the financial impact is limited or non-existent, justice will surely be sweet?

I have posted links to several recent reports as News items. But I thought it might be useful to group them together here, where hopefully others may be added. I hope I have accurately captured the essential in my brief summaries below – see the links for more details.

In November (2011), it was announced that the former CEO of Kaupthing, suspected of market abuse, had been called in for questioning as part of the ongoing investigations of the Special Prosecutor's Office (SPO). At the same time, the SPO was reported to be “currently investigating more than 200 cases, ten of which are expected to be completed before the end of this year.”
http://www.icelandreview.com/icelandreview/search/news/Default.asp?ew_0_...

This was followed in December by the news that six former Kaupthing executives, whose personal responsibility for loans they had received to buy shares in the bank had been lifted shortly before the collapse, had been judged liable to repay these loans. Action is being taken to ensure that assets both in Iceland and overseas can be seized to cover the debts (subject to confirmation by the Supreme Court). These are just some of “tens of cases” said to be still in court.
http://www.icelandreview.com/icelandreview/daily_news/Kaup%C3%BEing_Bank...

Then this month came news that the winding-up committee of Glitner has filed charges against two of its former CEOs for damages relating to a dubious loan.
http://www.icelandreview.com/icelandreview/search/news/Default.asp?ew_0_...

and that the Landsbanki Winding-Up Board is suing the top management of the bankrupt bank, board-members and insurers for damages caused by not stopping the bank’s operations on 3 October 2008 when, according to the WUB, the bank was de facto bankrupt.
http://uti.is/2012/01/landsbanki-winding-up-board-sues-managers-non-exec...

http://www.icelandreview.com/icelandreview/search/news/Default.asp?ew_0_...

http://uti.is/2012/01/more-on-landsbankis-last-hours/

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Al Thani case - as reported in Icelandic press

  • anrigaut
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  • Thu, 12/12/2013 - 18:49

Iceland Court Rules Kaupthing Executive Helgason to Repay Loans

  • anrigaut
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  • Thu, 02/05/2013 - 16:48

Less than two weeks before Kaupthing collapsed, its board had sought to revoke personal liability on loans given to a number of employees in connection with purchasing stock in the bank.

However, the Reykjavik District Court has now ruled that Ingolfur Helgason, the former CEO of Kaupthing in Iceland (yes, he's the one who signed our parental guarantee) must repay the loans he received, worth 1.1 million krona:
http://www.businessweek.com/news/2013-05-02/iceland-court-rules-kaupthin...

It appears, from the report in the Reykjavik Grapevine, that the Kaupthing resolution committee had previously resolved to absolve him of his personal responsibility for loans he received in 2006 (of which only half of one loan was used to purchase stock):
http://grapevine.is/Home/ReadArticle/Court-orders-bank-mogul-to-pay-up


Correction re Ingolfur Helgason ruling!

  • anrigaut
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Sorry - I can no longer edit my previous post. But the amount of the loans accorded to Ingolfur Helgason was of course 1.1 BILLION ISK (not 1.1 million) - so around £6 million.


Payback?

  • sambururob
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  • Thu, 02/05/2013 - 17:29

Thanks for being so diligent Anrigaut. As well as making us feel better that a fraudulent banker is being forced to pay back money is it likely to have a direct financial effect on our cause (i.e. my bank account!!) or is it too far removed from KSFIOM ?


re payback?

  • anrigaut
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  • Thu, 02/05/2013 - 20:26

Hi Sambururob,

I wouldn't count on any visible effect of this in your bank account.

While any increase in the recovery of Kaupthing's assets can only be good news, the amount involved in this case represents a drop in the ocean for the creditors of K hf (the amount of total claims in the winding-up is not yet finalised, but looks like being at least 3000 billion ISK). So the 1 billion owed by Ingolfur represents at most 0.03% of the total claims - and that's assuming he actually can and will pay. That said, this is just one of a fair number of similar cases (see my original post in this thread), some of which I suspect are still in the pipeline.

KSFIOM does have some interest in the level of recovery of K hf (both directly through the parental guarantee and indirectly through KSFUK's claim against K hf). But neither of these claims are finally agreed (though it appears the KSFUK one almost is), nor is the likely pay-out of Kaupthing, and it's impossible at present to estimate what they might yield. Only time will tell.

Meanwhile, as I wrote at the start of this thread, "even if the financial impact is limited or non-existent, justice will surely be sweet?"


Latest on the alleged financial fraud cases

  • anrigaut
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  • Thu, 25/04/2013 - 13:44

Yesterday (24 April) nine former Kaupthing employees were formally indicted on charges of market manipulation:
http://www.reuters.com/article/2013/04/24/iceland-bankers-idUSL6N0DB3DV2...

This is distinct from the so-called 'Al-Thani' case.

In the latest of her excellent blogs, Sigrun Davidsdottir (currently in Iceland and presumably present at the court hearing) tells more of the extraordinary proceedings (not reported elsewhere):

Iceland: prosecuting alleged major financial fraud means wrestling with tough defence lawyers

In two recent cases brought by the Office of the Special Prosecutor the focus has been on the defence team more than those indicted. The resignation of two defence lawyers from the al Thani case postpones the case until earliest February next year. In a case of alleged market manipulation at Kaupthing, the prosecutor asked that one of these two lawyers should be dismissed in order to prevent a repetition of the al Thani case. In a similar case against Landsbanki managers, the prosecutor asked for dismissal on grounds of conflicts of interest.

Yesterday, as one of the biggest cases, on alleged market manipulation and breach of fiduciary duty, brought so far by the Office of the Special Prosecutor came up in Reykjavík District Court for the first time, prosecutor Björn Þorvaldsson made a startling request: he demanded that Gestur Jónsson, defence lawyer for Sigurður Einarsson ex-chairman of Kaupthing, should be dismissed and Einarsson find a new lawyer.

Also Justice Arngrímur Ísberg seemed to be taken by surprise. Ísberg is famous in Iceland for what many see as a lenient grip on the infamous Baugur case where, incidentally, Gestur Jónsson acted as defence lawyer for Jón Ásgeir Jóhannesson. Ísberg was unsure if prosecutor Þorvaldsson could make this request but Þorvaldsson pointed him to a recent amendment to older law. After a deliberation for fifteen minutes Ísberg returned and refused the dismissal. The prosecutor has appealed Ísberg’s decision to the Supreme Court. ...

As Sigrun concludes:
"These latest events show that as elsewhere in big white-collar fraud cases, Icelandic defence lawyers know a trick or two to delay and thwart the path for the prosecutor when it comes to defending former high-flyers. The latest move by the prosecutor indicates that the OSP is prepared to play it tough. Or, as we say in Icelandic, “to converse with two rams’ horn” – not a sweet conversation."

See here for the full story:
http://uti.is/2013/04/iceland-prosecuting-alleged-major-financial-fraud-...


New turn in the al Thani case –

  • anrigaut
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  • Mon, 08/04/2013 - 17:10

-but again on track to start on April 11th

"Just as the defense team for those indicted in the al Thani case – Kaupthing’s second largest shareholder Olafur Olafsson and managers Sigurdur Einarsson, Hreidar Mar Sigurdsson and Magnus Gudmundsson – had exhausted all means of getting the case thrown out of court or suspended, the defense lawyers for Einarsson and Olafsson, Gestur Jonsson and Ragnar Hall, have resigned from the case. They claim that the defendants are not getting a fair trial and criticise the investigation by the Office of the Special Prosecutor and how the County Court and the Supreme Court have handled their case.

Bjorn Thorvaldsson, who represents the OSP, says to Ruv that the move by the defense lawyers came as a great surprise. The two lawyers tried five different ways to have the case thrown out or suspended, all five times taking the case to the Supreme Court. In the last case, for suspension, ruled on the the Supreme Court only last week, the Supreme Court reprimanded the two lawyers in its ruling for bringing a needless case to the Court.

However, only a few hours after the two lawyers handed in their letter (in Icelandic) to the Country Court, the judge in the coming case, Petur Gudgeirsson, refused to acknowledged their resignation. The oral hearings are planned to run for eight days. Ca. 50 people are being called to give witness. Now that the latest attempt by the defense lawyers to suspend the case it seems that the oral hearings will start, as planned, on Thursday."

http://uti.is/2013/04/new-turn-in-the-al-thani-case-but-again-on-track-t...


Principal Proceedings in Al-Thani Case Postponed

  • anrigaut
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  • Thu, 11/04/2013 - 12:32

Reported today in Iceland Review Online:

"The principal proceedings in the case concerning Sheik Mohammed Bin Khalifa Al-Thani of Qatar’s acquisition of more than five percent of shares in Iceland’s Kaupþing Bank shortly before it collapsed in autumn 2008 was postponed for an undecided period of time in Reykjavík District Court this morning.

Ragnar H. Hall and Gestur Jónsson, the defense lawyers of Sigurður Einarsson, former Kaupþing chair, and Ólafur Ólafsson, who used to be one of the bank’s majority owners, did not show up in court as they had already announced, visir.is reports.

Ragnar and Gestur reasoned that they could not serve as defense lawyers in this case anymore as the rights of their clients had been violated during the investigation.

Special Prosecutor Ólafur Þór Hauksson criticized their conduct in an interview with Fréttablaðið, stating that if their successors would do the same, the case could be postponed for all eternity. “This could lead to legal amendments being made to prevent such conduct.”

Sigurður’s and Ólafur’s new defense lawyers, Ólafur Eiríksson and Þórólfur Jónsson, attended the trial instead.

Sigurður and Ólafur are accused of market manipulation and breach of trust, as are Magnús Guðmundsson, former head of Kaupþing in Luxembourg, and Hreiðar Már Sigurðsson, the bank’s former CEO. They were all present this morning.

Around 50 witnesses will appear before the court in the case, which is among the most extensive that has ever been heard in Icelandic courts. "

http://www.icelandreview.com/icelandreview/daily_news/Principal_Proceedi...


Yet another unexpected turn in the al-Thani case

  • anrigaut
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Latest twist in this case - trial now scheduled to begin under a new judge on 21 October (but don't hold your breath!). As reported today by Sigrun:

The al Thani case has taken yet another unexpected turn – it seems that there are only unexpected turns in this case. Instead of postponing the oral hearing until February next year, as Justice Pétur Guðgeirsson of Reykjavík County Court had decided after a meeting with the new defence lawyers, the case will be assigned to a new judge, Símon Sigvaldason. Guðgeirsson will be off due to illness. The oral hearing is now set to start 21 October. The Office of the Special Prosecutor and the defendants heard of this yesterday, according to Rúv.

...

The fact that the court itself has now taken action to diminish the delay indicates that further delaying tactics might prove more difficult. Those following the prosecution of bankers in Iceland are no doubt in for some interesting twists and turns in the different trial sagas.

http://uti.is/2013/04/yet-another-unexpected-turn-in-the-al-thani-case/


The latest on the al Thani case

  • anrigaut
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  • Thu, 18/04/2013 - 08:27

Some of you may care to read a comment I've just added to Sigrun's latest blog on this case, here:

http://uti.is/2013/04/the-latest-on-the-al-thani-case/comment-page-1/#co...

Just doing my best to keep us on the radar!


Thank You Anrigaut

  • D RAM
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Your common sense, citical analyses and boundless energy on our behalf are greatly appreciated.

How you've kept it up over the years amazes me.

You are a star.

D RAM


Upcoming Kaupthing & Landsbanki cases

  • anrigaut
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  • Sun, 31/03/2013 - 22:34

Thanks to those who have kept this topic up to date during my absence, both in this thread and as news items.

Just for the record, to keep things together, the forthcoming cases against Kaupthing and Landsbanki managers are discussed in some detail in two blogs by Sigrun:
http://uti.is/2013/03/two-big-insider-trading-cases-coming-up-in-iceland/
http://uti.is/2013/03/the-machinery-of-kaupthing-landsbanki-market-manip...

Those charged in the Kaupthing case are:
chairman of the board Sigurdur Einarsson,
CEO Hreidar Mar Sigurdsson,
director of Kaupthing Iceland Ingolfur Helgason,
director of Kaupthing Luxembourg Magnus Gudmundsson,
director of corporate banking Bjarki Diego,
credit committee member and Kaupthing corporate employee Bjork Thorarinsdottir,
director of prop trading Einar Palmi Sigmundsson
and two private business brokers Birnir Saer Bjornsson and Petur Kristinn Gudmarsson.

According to the Guardian: "The criminal case is the largest in a series of fraud prosecutions that have been brought to court in Iceland in recent years, and may be one of the largest alleged market manipulation conspiracies ever seen in Europe."
http://www.guardian.co.uk/business/2013/mar/19/kaupthing-executives-indi...

Will be interesting to watch!


Six Persons Charged in Iceland Landsbanki Case

  • glen07
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  • Wed, 20/03/2013 - 23:52

19.03.2013 | 14:30
Six Persons Charged in Iceland Landsbanki Case
Former CEO of Icelandic bank Landsbanki Sigurjón Þ. Árnason, the bank’s former company division managing director Elín Sigfúsdóttir, former director of proprietary trading Ívar Guðjónsson and three other former employees of Landsbanki are facing charges because of alleged market abuse worth tens of billions of ISK.

This is the first extensive case for which the Office of the Special Prosecutor in Iceland issues charges concerning Landsbanki. The charges involve three different cases, including the company Ímon that bought shares worth ISK 9 billion (USD 72 million, EUR 55 million) in Landsbanki shortly before it collapsed in October 2008, ruv.is reports.

According to the report of the Icelandic parliament Alþingi’s special investigative commission, all of the shares were bought by Landsbanki’s proprietary trading division.

The report states that Ímon was granted a loan from Landsbanki worth ISK 5 billion at the end of September 2008 to buy shares in the bank itself.

The Icelandic Financial Supervision Authority referred its case against Landsbanki’s former employees to the Office of the Special Prosecutor in 2010, which resulted in extensive investigation, leading to Sigurjón and Ívar being taken into custody in January 2011.

The charges were issued last week and are to be presented to the accused today. They will likely be made public in the coming days.


Thanks glen07

  • anrigaut
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  • Sun, 31/03/2013 - 21:52

Just for the record, the link to this article is here:
http://www.icelandreview.com/icelandreview/daily_news/Six_Persons_Charge...


The CBI loan of €500m to Kaupthing on 6 Oct 2008

  • anrigaut
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  • Fri, 08/03/2013 - 11:30

None of this loan from the Central Bank of Iceland (CBI), which was apparently intended to help save KSF and thus maybe also K hf, ever reached the UK. Nor was it ever repaid to the CBI. The conditions of the loan and what happened to it are shrouded in mystery. An Icelandic parliamentary committee has been enquiring for the last year and is due to report very shortly. But it seems the CBI remains resistant to spilling any beans, though - at the last minute - says it has said it is 'considering its options'!

See Sigrun's account of the current situation on her blog, where I have added a comment:
http://uti.is/2013/03/the-only-secret-from-october-6-2008-a-cbi-loan-of-...


The al Thani Kaupthing case on the horizon

  • anrigaut
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  • Thu, 07/03/2013 - 12:04

Extract from Sigrun's latest blog (7 March 2013):

"The case that the Icelandic Office of the Special Prosecutor is bringing against three Kaupthing managers and Olafur Olafsson, at the time Kaupthing’s second largest shareholder, is coming up in the Reykjavik County Court today. It seems that now all legal quibbles the defendants brought up have been dealt with – all of them brushed aside – which means that the case can now take its course. Not quite now though, that will happen in mid April when the main proceedings are due to start. The Kaupthing managers charged are Sigurdur Einarsson, Hreidar Mar Sigurdsson and Magnus Gudmundsson.

This is by far the largest case brought so far by the OSP. There are fifty names on the witness list. One of them is the man who has given the case its name, Sheikh Mohammed bin Khalifa al Thani. The Sheikh is not accused of any wrongdoing and has not been charged but the OSP would like him to bear witness. It is not known if he will answer the request.

..."

http://uti.is/2013/03/the-al-thani-kaupthing-case-on-the-horizon/


Sheiks Refuse to Bear Witness in Kaupþing Case

  • anrigaut
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http://www.icelandreview.com/icelandreview/daily_news/Sheiks_Refuse_to_B...

Unsurprising! But it appears the court now has details of the settlement agreement between the Kaupthing WuC and Al-Thani. The trial is due to begin on 11 April.


To anrigaut

  • Gordon 45
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  • Fri, 08/03/2013 - 12:24

Thank you once more for all the information surrounding the Icelandic court cases. Most informative and shows the underhand methods employed by the banks in 2008.

Gordon 45


Kaupthing hf settles with Sheik Al Thani

  • anrigaut
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  • Fri, 08/02/2013 - 18:03

As reported today on the Kaupthing (Iceland) website: http://www.kaupthing.com/Pages/4271?NewsID=4458,

"Kaupthing hf. and Sheikh Mohammed Bin Khalifa Bin Hamad Al Thani, together with other related parties, have reached an agreement concerning the settlement of all claims and liabilities between them. This agreement has been reached on a commercial basis with no admission of liability by any party. As a result of the settlement, the proceedings commenced in Iceland by Kaupthing against Sheikh Mohammed Bin Khalifa Bin Hamad Al Thani have been discontinued and all other claims and liabilities have been released. All other terms of the settlement remain confidential."

As Sigrun goes on to point out in her latest blog: uti.is/2013/02/kaupthing-winding-up-boar...ith-sheikh-al-thani/ ,

"... According the SIC report Kaupthing loaned companies owned by Sheikh al Thani to buy shares in Kaupthing. This loan was allegedly behind the purchase of Kaupthing shares in September 2008. As reported earlier on Icelog the Office of the Special Prosecutor has charged three former Kaupthing managers and Kaupthing’s second largest shareholder in relation to this loan in a case similar to Barclays and the Qatari investors: neither bank declared it had allegedly loaned the investors money to buy the shares. In addition, Kaupthing lent the Sheikh against future profits. The Sheikh has not been charged of any wrong doing in Iceland but according to Icelandic media the OSP has indicated it might want to call him in as a witness in this case.

So what is Kaupthing hf settling? The SIC report and the OSP charges indicate that as well as issuing two loans in ISK, now around €157m, one of the Sheikh’s companies got a loan of $5om. This loan was “parts of the profits from the transaction” according to a Kaupthing overview of loans issued or discussed in one of the bank’s credit committees just before it collapsed. According to the writ, these three loans have never been repaid."


Reflections by Sigrun with comment by Tony Shearer

  • anrigaut
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  • Thu, 07/02/2013 - 20:36

Comment by Tony Shearer on Sigrun's latest blog:

"Thank you for the excellent reporting. Normally the law is an ass. This time common sense and the law came to the same conclusion. Those of us involved with Kaupthing knew that their business model would fail, to say the least. We told the FSA, who ignored these warnings, and only needed to look at the public facts to come to the same conclusions. The FSA, Treasury and Bank of England had far more resources and powers than the Icelanders. So who was more to blame? To me it is a no-brainer. The really difficult question is why have none of those involved in the UK been even reprimanded, and Sants even been knighted?
There is growing recognition that Hestor has not addressed the fundamental cultural issues at RBS any more than the old and the current board has at Barclays. Our politicians are so in awe/debt to these bankers, that they are still avoiding the issues. All credit to the Icelanders for addressing the real issues."

http://uti.is/2013/02/everything-is-relative-also-angst/


I would never have believed ...........

  • Valentine
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  • Wed, 09/01/2013 - 06:25

..........I'd say this, but it seems to me NOW that Brownanddarling (remember them?) - the dog with two arseholes - did kind of have a handle on things to do with banks, but this lot haven't got the foggiest.


The three main 2013 issues in Iceland

  • anrigaut
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  • Sat, 05/01/2013 - 20:52

More from Sigrun's Icelog:

"Before the end of January the EFTA Court might have ruled on Icesave. The largest battle for assets ever to take place in Iceland (since the 13th century) – ultimately for the power over Arion bank and Islandsbanki – will be, by far, the biggest issue in Iceland. At the core of it are the negotiations on composition for the holding companies of Kaupthing and Glitnir, the owners of the two respective banks. The capital controls are one variable in this equation. In addition, the Office of the Special Prosecutor will continue to churn out charges during 2013.
... "

Read more here:
http://uti.is/2012/12/the-three-main-2013-issues-in-iceland/


to Anrigaut

  • Gordon 45
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Hi Anrigaut,

Just on to thank you once more for informative and important information that you keep providing.

Gordon 45


Glinir: Former Icelandic bank executives jailed for fraud

  • anrigaut
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  • Fri, 28/12/2012 - 19:05

Just to keep track here (also posted an News):

"TWO former executives at an Icelandic bank which collapsed in the 2008 financial meltdown were sentenced to jail on Friday for fraud which led to a €53m loss, in the first major trial of Icelandic bankers linked to the crisis.
...
A Reykjavik court sentenced Glitnir's former chief executive, Larus Welding, and former head of corporate finance, Gudmundur Hjaltason, each to nine months in jail, of which six months were suspended for two years. They had denied the charges.
...
The special prosecutor is also looking into alleged wrongdoing linked to the collapse of the other two former top banks, Landsbanki and Kaupthing. "

http://www.independent.ie/business/former-icelandic-bank-executives-jail...


Re Glinir jail sentences

  • anrigaut
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Just to add that - as since reported by Sigrun- it seems likely that the State Prosecutor will appeal the sentence at the High Court, who may give a more severe sentence:

"The OSP reckoned the loans caused Glitnir a loss of €50m and had asked for a 5 1/2 year and 5 year prison sentence. Instead, the Count Court sentenced both men to nine months in prison, six of which are suspended for two years. Legal bills are divided between the two men and the state. – The State Prosecutor is likely to appeal."
http://uti.is/2012/12/the-three-main-2013-issues-in-iceland/

While the sentence pronounced by the Reyjyavik Court may appear derisory, it is I think worthy of note that, as Sigrun adds, this is "the first ruling concerning the big banks and leading bankers."

In the latest of his blistering blogs, Rowan Bosworth-Davies makes this point more strongly:
"The nine-month sentence handed down by an Icelandic court makes Welding the first head of a major bank anywhere in the world to be jailed for a crime linked to the global financial collapse."

and continues:
" What is the most exciting thing about this story is that it proves, without hesitation, that it is possible to prosecute senior bankers in a mature economy and convict them and send them to prison.

Now, my detractors will say "Iceland, where is that place?" or "Not the biggest world economy", but that doesn't matter. Everything is relative, and in a small country which suffered badly under the speculative maelstrom unleashed by the global banking criminals, they too were damaged severely by the actions of bankers who felt that they could do what they wanted without recrimination.

And the Icelanders have debunked that theory by sending these two banksters to jail.

And that message will be heeded by other Icelandic bankers, because when these two scumbags finish their sentences, they will never again be able to find work inside the financial sector. The very work skills they have spent years learning will be forced to lie idle because society has demonstrated that they don't ever want to have anything to do with criminals who have been marginalised by having been convicted of crimes.

That is because the convicted person has just been instantly 'labelled' as a 'criminal' and that very word alone possesses a great deal of emotive baggage.

So why is it that here in the UK, we cannot get the regulators and the other Government agencies to prosecute bankers like they have just done in Iceland?

Why have the senior executives of HSBC not been prosecuted for money laundering, and why was Barclays fined for LIBOR rigging, but no-one was charged with any criminal offences. ... "

You can read the rest here:
http://rowans-blog.blogspot.co.uk/2013/01/why-cameron-and-osborne-are-ta...


Arise, Sir Hector S...head

  • Valentine
  • 18/10/08 31/05/14
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  • Sun, 06/01/2013 - 06:17

Did anyone notice that Hector Sants, Head of the FSA until 2012, arch liar and cover-up merchant had received a Knighthood? The news was conveniently buried under the other Christmas festivities news. Santshead has since moved on to Barclays where he will allegedly receive 3 million for his efforts over 3 years.

I'm afraid it just goes to show that these people who contributed to the mess we are all in now go unpunlshed. A couple of Icelandic fraudsters get 9 months in jail (probably 6 weeks after all the deductions) and then walk out free to carry on where they left off.

A criminal trial for these people is useless because white collar crime is not considered to be a serious offence. Yet Santshead along with many others can be implicated in how many deaths?

What would be better, but it will never happen, would be an international tribunal in which all those who were in charge of banks and regulatory authorities in 2008 are made to answer all the allegations put to them. If they are found to be implicated in any wrongdoing, they should be banned from working in the financial sector for life, and stripped of their pensions, golden handshakes, and all their other assets. Then they would actually have to go out and EARN a living like most people.

I wish........


To Valentine

  • anrigaut
  • 19/10/08 30/10/09
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  • Mon, 07/01/2013 - 14:30

"A couple of Icelandic fraudsters get 9 months in jail (probably 6 weeks after all the deductions) and then walk out free to carry on where they left off."

Maybe not exactly. If Rowan is to be believed (see my post above or below), even if they never actually spend time in jail they will be labelled as criminals and "never again be able to find work inside the financial sector. "

If only we could have some of that in the UK. But as you say ... fat chance!


It will never happen as the

  • Brabander
  • 15/10/08 31/05/09
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  • Tue, 08/01/2013 - 11:27

It will never happen as the City is very close to Whitehall, both in geographic and political terms.
For recent proof look at Hector Sants!


I would never have believed ...........

  • Valentine
  • 18/10/08 31/05/14
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  • Wed, 09/01/2013 - 06:39

(oops sorry) ............ that I would ever say this, but it seems to me NOW that Brownanddarling (remember them?) - the dog with two arseholes - kind of had a handle on things to do with banks, but this lot haven't got the foggiest, have they?


Indeed Valentine ...

  • anrigaut
  • 19/10/08 30/10/09
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  • Sun, 06/01/2013 - 08:56

As Rowan Bosworth Davies' says:
" Arise 'Sir' Hector Sants " - You couldn't make this crap up!

http://rowans-blog.blogspot.co.uk/2012/12/arise-sir-hector-sants-you-cou...

He had previously blogged on "Why Hector Sants' appointment at Barclays is a classically cynical move from a bank in trouble!"
http://rowans-blog.blogspot.co.uk/2012/12/why-hector-sants-appointment-a...

If you don't know Rowan's excellent blog, they are all worth reading. As is Ian Fraser's blog http://www.ianfraser.org/


To anrigaut also......

  • Valentine
  • 18/10/08 31/05/14
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  • Mon, 07/01/2013 - 02:12

Let me join Gordon in saying thankyou for all the fantastic stuff you unearth for us. Rowan's blogs, Ian Fraser's blogs and also that excellent article on Mad Banker's Disease proove that there are people out there who are as aware as we are of the damage that bankers are doing to ordinary people's lives and to their prospects.

What is frightening to me is that none of these ideas seem to make it into the mainstream press. Is it part of the web of conspiracy that bankers spend their time weaving? I used to think that conspiracy theorists were a load of nutters - not any more : not since Enron, Lehman Brothers, KSFIOM etc. etc. etc.

It's really scary, though, that the majority of ordinary people are simply unaware that banks and bankers have become terrifying out-of-control monsters that nobody has the power or the will to do anything about.


Signs that awareness may be growing?

  • anrigaut
  • 19/10/08 30/10/09
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  • Mon, 07/01/2013 - 14:54

Valentine, Ice,

Thanks for opening up the discussion - I sometimes think I'm addressing a void when evoking these wider issues here!

It may be because these days I am looking more, but I do think awareness is growing, notably in the wake of the Libor business, PPI mis-selling, HSBC money-laundering etc, all of which certainly did make it into the mainstream press.

I found this part of Rowan's latest blog encouraging:

"Four out of five people want individuals to be prosecuted when banks break the law, according to a new survey.

Research by consumer watchdog, 'Which', has amply demonstrated that two-thirds of people believe the Government will not act in their best interests when implementing banking reform.
And only one in five think the Financial Services Authority is effective in regulating UK banks.
The watchdog is calling on the Government to ensure criminal prosecutions can be brought against individuals - up to boardroom level - who have presided over corrupt and dishonest practices.

These are findings which should be sounding a real warning bell in the Cabinet Room, because it means that a significant number of people are withdrawing their legitimacy from this Government, because they are failing to act in a manner which the great majority of the people want to see being adopted.

http://rowans-blog.blogspot.co.uk/2013/01/why-cameron-and-osborne-are-ta...


Valentine, couldn't resist your lead...

  • IceCrusher
  • 14/10/08 25/10/11
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  • Mon, 07/01/2013 - 12:50

It's really scary, though, that the majority of ordinary people are simply unaware that the world's leaders are out of their depth and haven't a clue about what to do to make things right. The world's economy is going down the toilet and the Yanks are jesting about minting a Trillion Dollar coin to help alleviate the impending financial disaster looming before them. The world and all 7B humans on it are 'led' by out-of-control muppets who have neither the power or will to do anything about righting the awful mess we are in. Heaven help us.

Ice


Glinir: Former Icelandic bank executives jailed for fraud

  • drglowry
  • 14/10/08 31/05/09
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  • Thu, 03/01/2013 - 13:18

Good news, but not soon enough (justice delayed) and not long enough. One would like to see some of the IOM officials in striped suits as well, rather than enjoying the fruits of their betrayal of their public trust.


Well,I hope that the culprits

  • Jean-Charles Marlier
  • 10/10/08 31/05/09
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  • Sat, 29/12/2012 - 15:47

Well,I hope that the culprits who are responsible for KSFIoM's bankruptcy will also be booked and jailed for much longer than nine months!


I agree

  • cottesmore
  • 21/10/08 16/07/12
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  • Sat, 29/12/2012 - 16:28

Yes, i totally agree.More over than that.ALL of their assets should be seized and handed to all the sufferers!!


Landsbanki WuB sues PwC Iceland and PwC LLP UK

  • anrigaut
  • 19/10/08 30/10/09
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  • Fri, 28/12/2012 - 12:23

More from Sigrun's blog:

"The Landsbanki Winding-up Board is suing not only PwC Iceland but also PwC LLP in the UK for damages caused by incorrect and misleading accounting of Landsbanki from mid 2007 until the collapse of Landsbanki in October 2008. The WuB is demanding in total a payment of ISK83bn (almost €490m), $11m and €65m. According to the WuB writ, not yet published but seen by Icelog, PwC LLP in the UK was responsible for Landsbanki’s accounting, which is why not only PwC Iceland is sued but also PwC LLP. Both PwC Iceland and LLP refute all allegations and will defend themselves vigorously. ... "

For more, see here:
http://uti.is/2012/12/landsbanki-wub-sues-pwc-iceland-and-pwc-llp-uk/


Jon Asgeir Johannesson charged with criminal offences

  • anrigaut
  • 19/10/08 30/10/09
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  • Mon, 17/12/2012 - 23:02

Relates to Glinir, not Kaupthing. But just for the record:

"Fallen Icelandic retail tycoon Jon Asgeir Johannesson, once one of the most powerful tycoons on the UK high street, has been charged in Reykjavik with criminal offences relating to allegations he exerted improper influence on the failed Icelandic bank that financed much of his business empire.

Johannesson – whose Baugur investment vehicle owned stakes in All Saints, House of Fraser, Hamleys, the Iceland frozen food chain and Woolworths – became the poster boy for Iceland's boom up until 2008 and his personal fortune was estimated at £600m. At the height of his success in 2007, his seemingly insatiable appetite for UK high street investments led to him being named the third most powerful retailer in Britain by Retail Week.

But Baugur, run from Johannesson's offices in Mayfair, came crashing down in the wake of Iceland's 2008 financial meltdown. Since then questions have been raised about whether the relationship between Johannesson's empire and Glitnir – one of three Icelandic banks that fell in the crash – had become too close.

Johannesson's Baugur group and linked businesses borrowed more than €1.5bn (£1.2bn) from Glitnir before the country's financial meltdown, making them by far the bank's biggest exposure to risk. Meanwhile, companies linked to him had large shareholdings in the bank.

Alongside Johannesson on the indictment is Glitnir's former chief executive Larus Welding. Charges against them and two associates have been filed by Iceland's special prosecutor, Olafur Hauksson, who is pursuing multiple criminal inquiries stemming from Iceland's financial crash. The charges relate to illegal lending and to aiding or abetting such lending. Prosecutors are seeking the maximum sentence under Icelandic law of six years in jail.

A lawyer acting for Johannesson declined to comment on Monday but — together with Welding and two co-defendents — the former Baugur tycoon is expected to appear in court in Reykjavik on 7 January to plead not guilty. Johannesson and Welding, both of whom live in London, have denied wrongdoing in parallel civil proceedings.
... "

http://www.guardian.co.uk/business/2012/dec/17/iceland-tycoon-jon-asgeir...


Charges Against Former Kaupþing CEO Dropped

  • anrigaut
  • 19/10/08 30/10/09
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  • Wed, 21/11/2012 - 08:17

All charges against former CEO of Kaupþing Luxembourg Magnús Guðmundsson in the so-called Al-Thani case have been dropped. The verdict by Reykjavík District Court came at around 9 am this morning and has already been appealed at the Supreme Court.

Charges of market abuse and breach of trust were filed against Magnús and four of his former colleagues by the Special Prosecutor’s Office.

According to the ruling, the charges were too vague and inadequately presented. The Icelandic state must pay Magnús ISK 9 million (USD, 71,000, EUR 55,000) in legal costs, visir.is reports.

According to visir.is, Magnús has refused to comment on the judgment until the case has gone to the Supreme Court.

A judgment on the other defendants is expected soon.

The case pertains to the purchase of a five percent share in Kaupthing Bank in late September 2008, merely two weeks before the banking system’s collapse.

Q Iceland Finance, the holding company of Sheikh Mohammed Bin Khalifa Al-Thani, was initially said to have bought a 5.01 percent share in Kaupthing but later it was revealed that Kaupthing itself financed the majority of the purchase.

The case has been under investigation ever since the collapse, or more than three years.

http://www.icelandreview.com/icelandreview/daily_news/Charges_Against_Fo...


Utterly but not

  • Jean-Charles Marlier
  • 10/10/08 31/05/09
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  • Thu, 22/11/2012 - 05:24

Utterly but not unexpectingly.......disgusting!

We have to hope that the icelandic Supreme Court sees reason prevailing and change that verdict for a "just"one and jails those wreckless financial gangsters.


FSO drops Kaupthing case - the OSP Kaupthing case in Iceland

  • anrigaut
  • 19/10/08 30/10/09
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  • Tue, 16/10/2012 - 18:24

The final nail in the Kaupthing coffin at the SFO: the investigation has been closed, due to “lack of evidence.” However, the SFO states in its press release today that the cooperation with the Icelandic Special Prosecutor will continue.

This has been a long and sorry saga after the fateful SFO house searches in March last year. Although several ex-managers of Kaupthing were investigated the main media focus here in the UK was on the Tchenguiz brothers, Vincent and Robert. The investigation into Vincent’s case was dropped this summer, with a full apology from the SFO.

Now, the whole investigation is dropped but no apology. This means that, amongst others, Robert Tchenguiz and ex-chairman of the Kaupthing board are no longer being investigated.

In Iceland, things are going better for the investigators. ....

Sigrun's blog on this is here:
http://uti.is/2012/10/sfo-drops-its-investigation-of-kaupthing-the-osp-k...


Tchenguiz's

  • Brabander
  • 15/10/08 31/05/09
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  • Tue, 16/10/2012 - 21:44

No surprise at all.
The SFO would have been put under serious pressure to drop the case.
This was NEVER a question of evidence but of protection at the highest levels.


Does punishment scare alleged white-collar criminals?

  • anrigaut
  • 19/10/08 30/10/09
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  • Tue, 07/08/2012 - 20:43

Another interesting blog from Sigrun:
http://uti.is/2012/08/does-punishment-scare-alleged-white-collar-crimina...

Does punishment scare alleged white-collar criminals? That seems to be the case in Iceland

"The effect of punishment is a hotly debated topic in criminology. The fact that two Icelandic bankers were sentenced to 4 1/2 years in prison for breach of fiduciary duty in the so-called Byr case seems to have shaken others in a similar situation. In an interview with Ruv tonight, the head of the Office of the Special Prosecutor Olafur Hauksson said that the OSP clearly senses that the Byr sentence has had an effect.

“The judgment gives a clear indication how the courts are likely to view similar cases. Also, the judgment has in some ways clarified things for those we are questioning, which means that the testimonies are now more clear than earlier,” Hauksson said. Those questioned are more willing to tell the whole story than earlier, which means that witness statements are better.

Hauksson says that the heavy sentences have spelled out the gravity of these cases. Many other cases under investigation regard breach of fiduciary duty where the sums at stake are not only ISK1bn, like in the Byr case but amount to several billions or even tens of billions. The maximum punishment for breach of fiduciary duty is six years, which means that the Supreme Court judges who ruled on the Byr case must have seen this activity as a serious crime.

Again, the question is why so little seems to be done in other European countries to prosecute bankers. Breach of fiduciary duty is a crime in most if not all Western countries, it is a fairly clear-cut activity – and yes, at least in Iceland it’s actually a serious crime."


The Exeter case: two bankers sentenced to 4 1/2 years in prison

  • anrigaut
  • 19/10/08 30/10/09
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  • Fri, 08/06/2012 - 10:30

Sigrun Davidsdottir today reports a new - and encouraging - ruling by the Icelandic Supreme Court:

"Reykjavik District Court acquittals last autumn in the Exeter case were a major blow to the Office of the Special Prosecutor. Thursday June 7 the High Court came to a radically different conclusion. Jon Thorsteinn Jonsson, ex-chairman of the board of Byr, a saving society and Byr’s CEO Ragnar Gudjonsson were sentenced to 4 1/2 years in prison, guilty of breach of fiduciary duty. The case of the third banker, CEO of MP Bank Styrmir Thor Bragason, was sent back to the District Court. Following this ruling, Byr must be considering if to sue these men for damages.

This ruling will have a major impact on other cases to come – it’s clear that there are other cases of breach of fiduciary duty in the Icelandic financial system before the collapse of the three major banks in autumn of 2008. This also means that the law related to this issue is robust enough for the court to rule on. And it means that there will be other bankers who now will be contemplating on earlier deeds and possible ramification.

It also shows the Icelandic authorities are serious about bringing cases related to the banks to court. And the latest ruling is a severe blow to the District Court. Interestingly, the District Court judge who acquitted the three bankers is the same who acquitted Jon Asgeir Johannesson and others in the Baugur case in 2005. ... "

http://uti.is/2012/06/the-exeter-case-two-bankers-sentenced-to-4-12-year...


Kaupthing: employee loans

  • anrigaut
  • 19/10/08 30/10/09
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  • Sat, 19/05/2012 - 07:06

Sigrun Davidsdottir's comments on the first Icelandic court decisions on the loans given to Kaupthing employees are here:
http://uti.is/2012/05/kaupthing-employee-loans-and-the-tchenguiz-judicia...

More cases still in the pipeline.


House searches in Landsbanki Luxembourg

  • anrigaut
  • 19/10/08 30/10/09
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  • Wed, 18/04/2012 - 07:48

The Icelandic Special Prosecutor's Office continues its investigations, with latest focus on the activities of Landsbanki in Luxembourg, as reported today:

http://uti.is/2012/04/house-searches-in-landsbanki-luxembourg/

"Today, thirty people – six of them from the Office of the Special Prosecutor in Iceland – have conducted house searches in Luxembourg on behalf of the OSP. The searches have been ongoing at the office of the Landsbanki estate and at two addresses in Luxembourg. According to special prosecutor Olafur Hauksson the searches are connected to nine cases, which surfaced in the media after searches in Iceland in January last year. ... "


Iceland investigates City fraud claims; SFO and FSA renounce

  • anrigaut
  • 19/10/08 30/10/09
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  • Sun, 18/03/2012 - 10:57

While Iceland investigates City fraud claims, our feeble watchdogs fail to bark
http://www.guardian.co.uk/business/2012/mar/18/icleand-investigates-city...

"Allegations of a London derivatives scandal involving Kaupthing are being vigorously pursued – but not by British regulators, whose funding and powers look increasingly circumscribed"

"Last week, about a dozen UK-based witnesses were questioned at the headquarters of the Serious Fraud Office over a suspected €500m market manipulation effort in the opaque and unregulated London credit derivatives market. Investigators believe an attempt may have been made to manipulate prices at the height of the banking crisis in the autumn of 2008.

... those asking the questions were not officials from the SFO or the Financial Services Authority. They were prosecutors from a tiny, debt-laden island in the Atlantic: Iceland."

"So all UK criminal investigations into a suspected €500m scandal at the heart of the City, involving some of the most controversial financial instruments invented in recent years, have been ditched because the British framework for dealing with financial fraud cannot cope."

So much for British justice. Great, isn't it!

Remains of course to be seen whether the Icelandic Special Prosecutor will also abandon; we can but hope he has more guts.


Smoke and mirrors?

  • expatvictim
  • 10/10/08 01/11/10
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  • Sun, 18/03/2012 - 19:19

Good to know , but a shame that this article's twist is to put down the current government (not saying they shouldn't or that I disagree with their sentiment) rather than do a more thorough investigative piece on what has gone before.

The FSA was "accused of not releasing key documents[to the SFO] ..... because of fears they will expose regulatory failings" back in 2010. Have they and the FSO really collaborated since? Sants has (unrelatedly) just resigned so no egg on his face and the FSA will shortly be be no more - so even if the Icelandic SP does expose how usless (or worse) the FSA were and IMO still are, there will be no public fall out even if it transpires someone at the FSA was aware of the CDIs and did nothing to prevent them. Bankers and politicos looking after their own.

Complex? They either did or did not lend money to third parties money that was effectively to be spent (or gambled) on the bank to be make it look better than it was. Whats complex about that. Seems like a cop out to me.

Let's not forget that Gudni Adalsteinsson (Kaupthing Treasurer) was hired by the FSA for a spell in 2010!! (as well as allegedly being one of those arrested in the Brothers T debacle).

Hope the Icelandic SP does the right thing.


Re smoke and mirors

  • anrigaut
  • 19/10/08 30/10/09
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  • Sun, 18/03/2012 - 19:51

I agree that is sounds like a cop-out. Note that they (FSA/SFO) don't say there is no case to answer but that "it would be costly and "untriable" in front of a jury in a British court because of the complex financial instruments involved." Ummm ....

Have added a short comment to the article. Why not add your's?


...

  • follow_the_tao
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 26/03/2012 - 05:13

...