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Eva Joly gets to work

Finally FINALLY it appears that the Office of the Special Investigator [aka the sheriff of Akranes] commissioned to investigate events surrounding the bank collapse has got its ass in gear and started doing something.

Today [and last Tuesday apparently, although we didn’t know about it] Icelandic police conducted a series of ten or twelve raids – depending on which media you follow – in connection with alleged market manipulation and fraud. The raids appear to focus on companies tied to one Ólafur Ólafsson, who apparently was one of “our” moguls [why does it leave a bad taste in my mouth to write that?] but who most people had never heard of until he paid old Elton John the GDP of a small African  nation to sing a few ditties at his birthday party back in oh-seven. [The title of this post which I penned back then, basically sums up what we, the plebeians of this land, were asking ourselves at the time in response to this outlandish decadence]. They even conducted a search of his home, which indicates that they had pretty strong suspicions of his culpability.

The allegations apparently revolve around the sale of a 5 percent share in Kaupthing bank back in September last year to some Sheik Mohamed Bin Khalifa Al-Thani [say that ten times real quick!] who appears to have been a front man for a scam intended to push Kaupthing shares up in price. Not certain of the details – not too much is being revealed now, but I remember this scandal surfacing a few months ago, along with myriad others. So many were coming up at that time, in fact, that it was impossible for a normal person to adequately keep track, but I seem to recall that they lent money to a company founded in SheikMohamedBinKhalifaAl-Thani’s name, who then transferred it to somewhere else, who then used approximately the same amount to buy the shares, thereby driving the price up. But don’t quote me on it.

In any case, it’s good to see that Eva Joly has rolled up her sleeves and is getting to work. Incidentally, she was spotted yesterday taking a stroll out by the Grótta lighthouse – my usual haunt – so the timing of the raids hardly seems like a coincidence. Sadly, however, I fear it’s much too late – it’s been eight months – EIGHT FRICKING MONTHS! – since the bank collapse, and nobody can tell me that those paper shredders have not been working overtime. Plainly speaking: I doubt they’re going to find anything, but I sure hope I am proven wrong.

In other news: The EU has requested Iceland’s assistance in formulating a new fisheries policy, Icelandic authorities have signed a deal with the British Virgin Islands for “information exchange” [read: busting through the bank secrecy laws in some of the most notorious tax havens], almost 50 percent of Icelandair has been taken over by Íslandsbanki, food prices are up by 25 percent, and Kaupthing bank is going after Robert Tchenguiz. Of course I’d love to elaborate, but it’s been an especially busy week [I’ve been talking to a lot of cool people; expect parts of those interviews to land on this site in due course] so unfortunately I can only supply the headlines. But, as most of you know, there’s always Iceland Review.

THE WEATHER HAS BEEN GLORIOUS
This week has been absolutely stunning. Sunny and bright and warm [for us, at least]. Party’s over, though, for the time being, as it’s set to cloud over with stormy weather in parts of the country until tomorrow. Which is just as well, so we can all hanker down and get some work done [because up here, places close due to weather – when it’s sunny]. Right now 10°C [50F]. The sun came up at 3.51, set at 11 pm.

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  • Ljósmynd DE May 23, 2009, 6:27 am

    I remember this Sheik-scam of Kaupthing from last september, when it was published as a proof of trust in the bank. Here are some more details:

    http://www.economicdisasterarea.com/?p=704

    Hope, it’s not to late for some findings.

  • Dave Hambidge May 23, 2009, 7:12 am

    Alda, just a quick query, what on earth is the bizarre looking bird in the photo on the front page? A new hat for AAH, EPI trying his hand at taxidermy?

    dave

  • alda May 23, 2009, 10:55 am

    LDE – thanks for the link.

    Dave – I’m assuming you mean the baby rooster. 🙂

  • Dave Hambidge May 23, 2009, 11:37 am

    Rooster!!

    There’s not enough meat on that for one mini-sub roll!!

    dave

  • alda May 23, 2009, 1:22 pm

    Dave. It’s a baby. We don’t eat babies. 😉

  • Colin May 23, 2009, 2:37 pm

    Never fear Alda, I bet there are plenty of electronic records and not just paperwork – and that sort of thing is much harder to get rid of than people think. And that’s not even accounting for people’s arrogance prompting them to not shred anything because they think that they are untouchable… Put it this way, if they are as good at covering their tracks as they were at running their investments, there should be no shortage of interesting documentation!

  • Dave Hambidge May 23, 2009, 6:15 pm

    Hello there. Just a quick note to say that I have highlighted this blog in an e-booklet I have produced to accompany an interview I will be doing on BBC Radio Stoke (North Midlands of UK) on Sunday 24 May 2009 at 1400hrs BST.

    The subject will be internet publishing and blogging.

    To see the e-booklet, please go to;

    http://tinyurl.com/r4qw7o

    If you have the inclination to listen to the interview on line please go to

    http://www.bbc.co.uk/iplayer/console/bbc_radio_stoke/

    Best wishes

    dave

  • idunn May 23, 2009, 8:23 pm

    I’d be curious not only how the Icelandic authorities handle this, but more so the people.

    My feeling is within the US, and recession here, that the primary impetus is for finger pointing at banks and others (a good deal of this warranted), but that the underlying imbalances that allowed so much of this to happen largely ignored by the populace. In other words, that most content with easy answers and the illusion of a return as soon as possible to business, and life, as usual.

    My understanding that the situation in Iceland different to an extent as so much of the present kreppa centered on bad banking practices. However that if a large part of the populace had not bought into the easy times, and a certain American style excess and greed, that the extent perhaps not as much. Moreover now, for both nations and the world, that this recession, if different in detail, signifying a basic sea change in human affairs.

  • hildigunnur May 23, 2009, 8:49 pm

    heh, yes they were investigating at husbands’ job, (Samskip, Ólafur’s chairman of the board and this company’s actually his first and maybe biggest stepping-stone up to the vaults of financial swindle). Husband took no notice, though but then he’s not really in the thick of finance, working as he is, in the IT dept.

    I hope they’ll get him – and all the others! (not afraid for husbands’ job, the company’s in good shape and is a huge asset, they won’t tear that up).

  • Bromley86 May 24, 2009, 7:53 am

    Does anyone know where Q Iceland bought the shares? Was it on the market from normal shareholders or was it from Olafur Olafsson?

    Because whoever sold those shares must be very happy. Of course, Olafur might be happy with the 12.5bn ISK that he made on the bond, but if it turns out that he was also effectively using bank money to buy his shares, then it’s not just market manipulation.

  • Lee, UK May 24, 2009, 9:58 am

    Al Capone was eventually convicted for income-tax evasion, not for his illegal enterprises, organised corruption, or violence. Similarly, I suspect that Iceland’s white-collar criminals will end up convicted for relatively minor technical offences – and the individual punishments won’t match the collective crime of nearly bankrupting the country…

  • Physchim62 May 25, 2009, 1:59 pm

    @Bromley86, apparently the shares were bought from Kaupþthing banki h.f., from the stock that the bank had built up. It’s not illegal for (European) banks to buy their own shares within limits: in fact, it’s an everyday occurrence in many countries. Still, Kaupthing had bought so many of its own shares that it was supposedly up against the legal limit, so was desperate to sell them to someone. And yes, it is a valid question as to from whom Kaupþthing banki h.f. bought all those shares (giving cash in return) in the first place…

  • JoeInVegas May 26, 2009, 8:04 pm

    The higer ups almost never have anything done to them. There will probably be no proof left with direct implications, especially after all this time to clear it up.
    Letters to the editor in our local paper, in regards to the torture alligations, are ‘it’s over, let’s move on to something else’ probably reflect most people. I would rather see somebody hang, as advanced notice for the next group that want to ignore the laws. If there is no threat of punishment then there is nothing stopping most people except ther conscience which usually does not speak up.

  • Bromley86 May 26, 2009, 11:04 pm

    Thanks Physchim62. Sad to see that the MoP is on a zero day week – this is the sort of detail that’s not in most news/blogs. Do you mind me asking how you know that they were bank owned shares (couldn’t find that myself)?