Nine Persons Charged in Iceland Kaupþing Bank Case Skip to content

Nine Persons Charged in Iceland Kaupþing Bank Case

By Iceland Review

Nine individuals, including former Kaupþing CEO Hreiðar Már Sigurðsson and chair Sigurður Einarsson, have been charged by the Office of the Special Prosecutor in Iceland for having been party to universal market abuse involving Kaupþing Bank buying shares in itself.

kaupthinghead_ipa-sjoThe headquarters of the now defunct Kaupþing bank. Photo copyright Icelandic Photo Agency.

The charge was issued last week and presented to the accused yesterday. This is the most extensive case the Special Prosecutor has ever been involved in and the most extensive of its kind in the world, according to Fréttablaðið.

Former director of Kaupþing in Luxembourg Magnús Guðmundsson and former director of Kaupþing in Iceland Ingólfur Helgason are also facing charges. The other five persons are all former employees of Kaupþing.

The case concerns five matters of market abuse which have been under investigation for a long time and have now been combined in a single charge.

These include Kaupþing’s acquisition of 29 percent of all available shares in itself in 2005-2008. The Special Prosecutor has reasoned suspicion that the trade was carried out with the knowledge and intent of the bank’s key executives, in a systematic and organized manner to maintain the value of shares.

The shares were purchased, among other methods, through special customers who were granted loans from Kaupþing for the acquisition.

The day before Kaupþing collapsed in October 2008, 92 percent of the portfolio of assets of the bank’s proprietary trading was shares in the bank itself.

Related:

11.03.2013 | Kaupþing Loan in Breach of Lending Rules

07.03.2013 | Sheiks Refuse to Bear Witness in Kaupþing Case

ESA

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