Sigrún Davíðsdóttir's Icelog

French charges against Landsbanki Luxembourg managers re equity release schemes

with 4 comments

Icelog has followed the sad case of Landsbanki Luxembourg equity release loans for some years now. Those who took these loans in the years up to the collapse of the bank in October 2008 have for years been fighting for an investigation into these loans – in terms of the soundness of the original scheme, Landsbanki’s handling of the investments that were supposed to finance the loans, Landsbanki’s alleged breach of investing terms by investing in Landsbanki and Kaupthing bonds and then the whole handling of the bank’s administrator Yvette Hamilius.

After investigating these claims the French investigative judge van Ruymbeke opened an investigation. Following his investigation chairman of Landsbanki board Björgólfur Guðmundsson, Landsbanki Luxembourg manager Gunnar Thoroddssen, seven employees of the Luxembourg bank and the estate of Landsbanki Luxembourg, represented by Hamilius have now been charged with fraud and various other offenses.

Many other banks have settled equity release loans out of Luxembourg but not Landsbanki. This case is yet another example of the lax client protection there is in Europe when it comes to banking – another is FX loans, which I wrote about in my last blog (also on Fistful of Euros).

It takes long time to handle complaints; to begin with the authorities tend to shrug off any allegation of a bank’s mishandling, even now after so many cases of banks’  rather inglorious and harmful behaviour. What is so galling about the Landsbanki Luxembourg case is that most of the clients were elderly and/or retired people. For those who have been struggling to find clear answers regarding those loans the last step in France is a step in the right direction.

*See here for some earlier Icelogs on the investigation and the Landsbanki Luxembourg saga.

Follow me on Twitter for running updates.

Written by Sigrún Davídsdóttir

January 26th, 2015 at 4:47 pm

Posted in Iceland

4 Responses to 'French charges against Landsbanki Luxembourg managers re equity release schemes'

Subscribe to comments with RSS or TrackBack to 'French charges against Landsbanki Luxembourg managers re equity release schemes'.

  1. Well done the French.
    Any news re the Supreme Court oral hearing in the al Thani case which was scheduled for 26/27.
    Or the further big Kaupthing-related cases coming up in the Reykjavík District Court this year.

    Tony Shearer

    28 Jan 15 at 10:51 am

  2. Very excellent weblog, thank you for the time and effort in writing the posts.

    Divina Steckline

    10 Mar 15 at 8:09 pm

  3. […] has earlier reported extensively on this saddest part of the Icelandic banking collapse saga. What is truly […]

  4. […] but in France and Spain (I have covered this case for a long time, see links to earlier posts here). Many other banks were doing the same, also out of Luxembourg. The same type of financial products […]

Leave a Reply