Kaupþing Former CEO Strikes Back in Al-Thani Case Skip to content

Kaupþing Former CEO Strikes Back in Al-Thani Case

Hreiðar Már Sigurðsson, former CEO of Kaupþing, who is among defendants in the so-called Al-Thani Case, reasoned in a statement submitted to Reykjavík District Court this week that he was not responsible for laws violated by his subordinates in the case.

kaupthinghead_ipa-sjoPhoto copyright Icelandic Photo Agency.

Hreiðar states that the settlement of the liability insurance of Sheik Mohammed Bin Khalifa Al-Thani of Qatar, carried out on October 8, 2008—the day that Kaupþing collapsed—was a legal violation and most likely punishable, Fréttablaðið reports.

The statement refers to Al-Thani’s company Brooks Trading in the British Virgin Islands being permitted to buy ISK for a loan from Kaupþing worth USD 50 million at off-shore rate, which covered his ISK 12.6 billion liability insurance for the loan to buy shares in the bank.

Kaupþing’s winding-up committee considers the liability insurance to be unpaid and have summoned Al-Thani to repay it.

The statement says it’s incredible that charges were filed because of the loan but not the Brooks Trading scheme orchestrated by Hreiðar’s subordinates.

The Special Prosecutor has accused Hreiðar of breach of trust and market abuse, reasoning that the loans granted to Al-Thani had the sole purpose of raising the value of shares in Kaupþing.

The loans were in the bank’s disadvantage and the market was deceived by indicating that funding from Qatar was being contributed to the bank’s operations, the Special Prosecutor reasons.

Initially, in the autumn of 2008, Q Iceland Finance, the holding company of Al-Thani, was reported to have bought a 5.01 percent share in Kaupþing but later it was revealed that Kaupþing itself financed the majority of the purchase.

In addition to Hreiðar, former chairman of Kaupþing Sigurður Einarsson, former CEO of Kaupþing Luxembourg Magnús Guðmundsson and Ólafur Ólafsson, who was the bank’s second largest shareholder at the time, are on trial.

The case of the Special Prosecutor’s Office against the Kaupþing four opened in Reykjavík District Court in March, 2012.

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