God Hates Iceland

[Peter Presland]

Amid the recent deafening silence about Iceland, this cheered me up a little. Authored by a very attractive, very young and clearly nobody's fool, Icelandic girl pictured at the link - Go Girl!!

Poor Iceland has some powerful enemies now though. If they don't get back in line they'd better watch their backs - and if they do, probably better off emmigrating.

One thing I’ll give Icelanders is that since the crash people knew who was to blame: Irresponsible Viking bankers who raided the globe’s financial systems and threw themselves into metaphorical pools of cash money. I mean, it would have been fun to just blame Homer Simpson, but alas. Yes, the government has a share of the blame and yes, all the people who took unjustifiable loans to buy themselves a Range Rover have a share of the blame. But even so, with only 320,000 people, they knew that if you added all the lame personal loans up, there was still a lot of money unaccounted for.
When the Special Investigative Commission report came out Icelanders caught a glimpse of just how far Icelandic bankers had pushed the boundaries of not just ethical practice but how murky the legal territory they were wading in was.
Although Icelanders had speculated about the outcome of the report and certainly theorized about the extent of the corruption, I don’t think anyone thought it would be quite so ridiculous.
Corporate tycoons would buy banks. Then they would lend themselves money from the banks they’d bought. Like it was their personal piggy bank and a string of people would help them do this without getting caught.
Until now, of course. I wonder, when the police began to arrest the banking executives, owners, presidents and lawyers, whether they had seen it coming. I mean, they’ve been untouched for two years.
I remember how after the crash my mum would tut as we drove around town in her tiny Punto, point out men in Hummers and go: “That there is the president of such and such bank—he’s played a key role in destroying our country but there he is guzzling gas on his way to a five-star restaurant!”
These guys have been going about their regular business, easily maintaining their pre-crash lifestyles because they knew when to tuck their stolen cash away before it got sour and all the while Icelanders have watched on with interest wondering and indeed losing hope that eventually they’d see their come-uppance.
But perhaps it’s finally en route? Last week the asset freezing and arrests started.
One of the first one hit: Jón Ásgeir Jóhannesson, charismatic owner of Baugur and previous major shareholder in the bank Glitnir.
He is now facing a global asset freezing order and was given 48 hours last week to list everything he owns or face jail.
This all lead back to allegations put forth in a lawsuit against him which states that he conspired with associates to “fraudulently drain over USD 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.
Others facing the chopping board include Hreidar Már Sigurdsson, former chief executive of Kaupthing, who was arrested earlier in the month 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.
Magnús Gudmundsson, former director of Kaupthing in Luxembourg also faces a legal storm as he and Sigurdsson are jointly on travel ban 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.
Meanwhile, since we’re on the topic of Kaupthing (if you’re English you might remember John Cleese doing commercials for them... sigh), Sigurdur Einarsson, former chairman of Kaupthing, has filed charges to the Supreme Court of Iceland because of the international warrant for his arrest issued by the special prosecutor last week. Unsurprisingly, his charge was dismissed.
Other individuals named in the lawsuit against Jóhannesson and his accomplices 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.
Oh yeah, and now the winding-up committee of Landsbanki is prepping the mother of all lawsuits against the bank’s former management and the owners.
It’s complicated, I know, but at least Iceland is confronting this now and isn’t laying blame on a fictional target (Homer Simpson, I’m looking at you) but trying to gain, albeit a delayed, justice from these cowboy bankers.
Nanna Árnadóttir – nannaa@hotmail.co.uk