Former CEO of Iceland’s Kaupthing in Custody Skip to content

Former CEO of Iceland’s Kaupthing in Custody

By Iceland Review

Former CEO of the Icelandic bank Kaupthing, Hreidar Már Sigurdsson, was given a 12-day custody sentence in Reykjavík District Court today at the request of the Special Prosecutor’s Office. Magnús Gudmundsson, former director of Kaupthing in Luxembourg, was given a seven-day custody sentence, as stated on

The former Kaupthing directors are suspected of market abuse. Photo by Páll Stefánsson.

The two former directors of Kaupthing are being held on suspicion of having organized trades worth almost ISK 100 billion (USD 770 million, EUR 600 million) with the purpose of increasing the value of stocks in the bank one month before it collapsed in October 2008, Fréttabladid reports.

Yesterday, Special Prosecutor Ólafur Thór Hauksson had Sigurdsson and Gudmundsson arrested after they had been brought in for questioning.

Both Sigurdsson and Gudmundsson spent the night in prison cells. This is the first time that the special prosecutor has requested custody of a suspect.

The suspects are also believed to have been in breach of authority, forged documents and committed various violations of the law on limited companies, most of which were undertaken in 2008.

The investigation of market abuse involves trade worth tens of billions of ISK with men such as Sheik Mohamed bin Khalifa Al-Thani of Qatar, Skúli Thorvaldsson and Kevin Stanford.

Some details of these cases were not uncovered until the release of the report of the Special Investigative Committee on April 12, which partly explains why it hasn’t been requested until now that suspects be taken into custody.

According to Fréttabladid’s sources, the purpose of the custody is mainly to prevent suspects from influencing accomplices or witnesses.

It is also possible that documents that investigators have not seen yet might be deleted or damaged if suspects are freed from custody. However, there are no indications that evidence has been compromised so far.

Gudmundsson is currently the director of Banque Havilland in Luxembourg, which was established on the foundation of Kaupthing in that country. Banque Havilland is owned by an English family.

Sigurdsson runs the consulting company Consolium in Luxembourg with Ingólfur Helgason, among other partners, who used to run Kaupthing in Iceland.

Sigurdur Einarsson, former chairman of Kaupthing, has been called in for questioning next week. He is currently in London.

Click here to read more about the Al-Thani case and here to read more about the cases of Skúli Thorvaldsson and Kevin Stanford.

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