So, the Office of the Special Investigator into the bank collapse carried out a series of raids yesterday in conjunction with the Serious Fraud Office in the UK [as Andrew mentioned in the comments to the last post]. The raids are aimed at brothers Ágúst and Lýður Guðmundsson, former owners of Kaupthing bank, and in particular their dealings around their holding company Exista. The Guardian reports on this here.
Exista has been under the microscope for a while now and please don’t ask me to explain the intricacies of the power struggles that have been going on around that company because I don’t understand even a fraction of it. Suffice it to say that there has been all sorts of shuffling of shares in this company into that company, and wheeling and dealing with stocks and equity, and the last I heard the two brothers were willing to relinquish their share in one of their companies to the bank that was its largest creditor ON THE CONDITION that they – the two brothers – remain at the helm of the company AND CAN NEVER BE FIRED.
[Is it any wonder the mind boggles? And do you now see what I mean when I say it is IMPOSSIBLE for a mere mortal being to keep up with all the insanity and crazy intrigues and power struggles and whathaveyou that we are presented with on a daily basis? Is it any wonder we sometimes just want to crawl into bed and pull the covers over our heads and wake up in about two decades when fricking Icesave has been paid off or, alternatively, we’ve become a British or Dutch colony?]
Likewise I am not equipped to give you the lowdown on the exact suspicions in this case, except that they have to do with the above-mentioned shuffling and loans taken from Exista without the approval of its creditors, and writing off personal liabilities for loans. Something like that.
However, one of the suspected violations did catch my attention: that one Sigurður Valtýsson, one of Exista’s two CEOs, transferred his debts and shares in Exista amounting to ISK 160 million into a company registered in Tortola a short time before the bank collapse in 2008.
This Sigurður Valtýsson is the son of Valtýr Sigurðsson, Iceland’s State Prosecutor. Some of you may remember that Eva Joly threatened to resign from her post as advisor to the Special Prosecutor last year unless Valtýr Sigurðsson were removed from office, since – as the father of a suspect – he was incompetent to deal with matters surrounding the collapse. He responded with great indignation and refused to budge. The matter became a fairly sticky one for the Minister of Justice, who finally resolved it by creating a special State Prosecutor to deal with matters surrounding the collapse. Valtýr Sigurðsson, meanwhile, got to remain in office to deal with all the other stuff.
As it turns out, however, Mr Sigurðsson range of family ties is extensive. A few days ago he was forced to withdraw the charges made against the protesters who stormed Althingi last year [which I wrote about here] because one of the Althingi guards is the half-sister of Mr Sigurðsson’s wife, and as it happens she [the guard] has filed a civil suit against the protesters.
The matter, therefore, has been transferred to another State Prosecutor, who has yet to decide whether or not the protesters will be charged at all. Ah, the tribulations of modern Iceland.