Jon Asgeir Johannesson: 48 hours to Stay out of Jail Skip to content

Jon Asgeir Johannesson: 48 hours to Stay out of Jail

Jón Ásgeir Jóhannesson now has 48 hours to provide an exhaustive list of his assets or risk jail. According to various icelandic sources Jóhannesson’s lawers in London received a subpoena on Thursday afternoon. His wife Ingibjörg Pálmadóttir told Fréttabladid in an interview yesterday, that they knew no more than the journalist about the case. “We had to follow the press conference of the winding-up board to fill in the gaps. … We are trying to find out what is going on. This is weird. If you [the journalist interviewing her] can tell us something I would welcome that. This is a huge case, the sums of money are unbelievable. We know as little as you do. We .. I don’t know anything,“ Pálmadóttir said.

Jon Asgeir Johannesson, photo: Páll Stefánsson/Iceland Review

Another businessman named in the suit, Pálmi Haraldsson, owner of Iceland Express, told Fréttabladid that the lawsuit was “full of nonsense.” Haraldsson was named as a former board member of Glitnir, which was incorrect. “I am speechless. One should expect that such a case would be built on logic and truth.” Yesterday Haraldsson threatened to sue the winding-up board because of false accusations.

Other individuals named in the lawsuit are former chairman of Glitnir Thorsteinn M. Jónsson, former Glitnir CEO Lárus Welding, Jón Sigurdsson, CEO of FL Group and former FL Group CEO Hannes Smárason.

Hannes Smárason. Photo: Páll Stefánsson/Iceland review

Jón Ásgeir Jóhannesson, a former leading shareholder in Glitnir and once a big investor in the UK retail sector, is alleged in the lawsuit to have conspired with associates to “fraudulently drain over $2bn out of the bank to fill their pockets and prop up their own failing companies.”

“There is evidence supporting the allegation that Glitnir bank was robbed from the inside,” said Steinunn Gudbjartsdóttir, who chairs the Glitnir winding-up board.

Mr Jóhannesson has denied the allegations. “It’s just politics,” he told Bloomberg yesterday. “I have full proof that we were repaying loans that were maturing 20 to 40 days later. This was just the refinancing of older loans.” He claimed that David Oddsson, the former Prime Minister of Iceland, was behind the case. Oddsson, who is now editor of Morgunbladid, is not known to have any connection to the winding-up committee.

The lawsuit is adding pressure on the Viking Raiders who controlled Iceland’s three main banks – Glitnir, Kaupthing and Landsbanki – and a range of high-profile foreign assets until their empires crumbled in October 2008.

Icelandic authorities last week arrested Hreidar Már Sigurdsson, former chief executive of Kaupthing, on suspicion of offences including embezzlement, falsifying documents and stock and bond trading violations, in the most high-profile move so far by prosecutors investing possible wrongdoing in Iceland’s banks. An arrest warrant was this week issued for Sigurdur Einarsson, Kaupthing’s former chairman, and circulated by Interpol. So far Einarsson, who is staying in his Chelsea apartment in London, has not been arrested.

Glitnir said its lawsuit was based on a year-long probe by Kroll, the corporate intelligence company. It has passed on its findings to Icelandic prosecutors.

The lawsuit was filed in the Supreme Court of New York state (Glitnir Bank hf v. Johannesson, 601217/2010, New York state Supreme Court (Manhattan)) , where Glitnir said many of its creditors were based. Central to the case is a $1bn bond issue in 2007 in which US investors were allegedly misled over Glitnir’s financial exposures.

Jóhannesson, who is still a director of House of Fraser and chairman of the Iceland frozen foods chain, was also hit with a global asset freeze order, giving him 48 hours to hand over a list of what he owns.

The lawsuit alleges: “A cabal of businessmen led by convicted white-collar criminal Jon Asgeir Johannesson, engaged in a sweeping conspiracy to wrest control of Iceland’s Glitnir Bank to fill their pockets and prop up their own failing companies.”

“The individuals siphoned money out of Glitnir at the worst possible time for the bank . Having depleted Glitnir’s cash reserves after April 2007 by engaging in heavy and improper lending to entities that they controlled, the individual defendants left Glitnir heavily exposed to the global credit crunch.”

The suit also accuses Mr Johannesson and his co-defendants of staffing the bank with their “willing accomplices”, ignoring the risk committee and concealing their self-dealing with “a blizzard of controlled companies.”

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