Sigrún Davíðsdóttir's Icelog

OSP in action related to Glitnir (updated)

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Today, several persons have been brought in for questioning with the Office of the Special Prosecutor. The investigation centres on Glitnir and FL Group, both of which were under control of Jon Asgeir Johannesson. The CEO of FL Group was Hannes Smarason, who left FL Group late 2007, when the company had run out of steam and money.

Apparently, some were employees of Glitnir, some said to be now working for Islandsbanki, the going concern of Glitnir’s domestic operations. DV has named two present employees of Islandsbanki, Johannes Baldursson and Elmar Svavarsson.

According to Ruv, Larus Welding, who was brought in as a CEO of Glitnir, when Johannesson and his associates took Glitnir over, has been sent to a week’s custody. In an email, published in the SIC report, Welding complains that Johannesson treats him like a branch manager, not like the CEO of a bank. Soon after the collapse of the banks, Welding moved to London.

As earlier media coverage, and the SIC report shows there was a wealth of intriguing affairs going on in Glitnir related to FL- and Baugur-related companies. The present investigation centers on ten cases, involving Glitnir’s prop trading and other business related to shares in Glitnir and in the aforementioned companies.

This is the first time that people related to Glitnir have been brought in for questioning. With the Glitnir case, in addition to earlier investigations related to Landsbanki and Kaupthing all the three major banks are now being investigated. In all cases, fraudulent activity involving billions of krona is being investigated, showing the outline of something far bigger and deeper than just failed attempts to save failing banks.

Many Icelanders feel the OSP is taking a long time to investigate alleged fraud related to the three banks that collapsed in October 2008. However, it’s well known that fraud investigations tend to be time-consuming. In terms of the economy, Iceland is doing well but the feeling is that as long as the fraud investigations are ongoing the events of October 2008 and the boom years are still an open book to the Icelandic mind.

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Written by Sigrún Davídsdóttir

November 30th, 2011 at 5:52 pm

Posted in Iceland

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