Former Finance Ministry Undersecretary Faces Charges Skip to content

Former Finance Ministry Undersecretary Faces Charges

Baldur Gudlaugsson, former undersecretary of the Ministry of Finance, has been charged with internal fraud and violations in a public office. Gudlaugsson was charged when he came on his own initiative to the Office of the Special Prosecutor yesterday.


Photo by Páll Stefánsson.

The charge is issued by Bergur L. Bergsson, acting state prosecutor—the state prosecutor is to handle all matters regarding violations in a public office, Fréttabladid reports.

This is the second charge filed following an investigation of the special prosecutor. Bergsson has given Special Prosecutor Ólafur Thór Hauksson the task of taking this case to trial.

Gudlaugsson sold his shares in Landsbanki for more than ISK 192 million (USD 1.7 million, EUR 1.2 million) two weeks before the banking collapse in October 2008.

He is charged with having had access to insider information about the bank’s situation at the time of the sale because of his membership in the Central Bank’s consultation group on financial stability.

The amount has been frozen in Gudlaugsson’s account. A seizure claim will be made and it is likely that the freezing order will be in effect until the case has been concluded.

Gudlaugsson is also charged with violations in public office according to the 138th article of the penal code. It says that if a person abuses his or her public position to commit a crime, the judge can extend the sentence by as much as half. The penal frame for internal fraud is six years, but nine years in Gudlaugsson’s case in light of this article.

Karl Axelsson, Gudlaugsson’s lawyer, states that the charge is groundless, adding that during the current atmosphere in Iceland it is important for courts to maintain their reputation. “I’m concerned that courts will fluctuate with public opinion,” he said.

The case will open in court in about a week.

Click here to read more about Gudlaugsson’s case and here to read more the investigation of the special prosecutor.

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