Former CEO Of Failed Iceland Bank Landsbanki Arrested

Tyler Durden's picture

Iceland, which alone in the entire developed world allowed its banking sector to collapse, and which, also alone, has benefited from a recovery that is truly organic courtesy of a devaluation of its currency and a global restructuring of its corporate balance sheet (read wipe outs for its banker class), continues to show the world that it is possible to have at least some semblance of justice in a world captured by fraud and criminal financial interests. After the CEO of failed bank Kaputhing was arrested back in May, today AFP reports that Iceland police has also detained the former CEO and several other executives of the other major Iceland failed bank: Landsbanki.

From AFP:

Two former heads of collapsed Icelandic bank Landsbanki, including a former chief executive, have been arrested in connection with a market manipulation probe, the prosecutor on the case said Friday.

Sigurjon Arnason, the former head of the failed bank, and Ivar Gudjonsson, its former investment chief, were arrested Thursday and went before a judge Friday afternoon, special prosecutor Olafur Thor Hauksson told AFP.

"An investigation is still in process," he said, adding that if the two men were charged with market manipulation they would face a maximum prison sentence of six years.

The two men were remanded in custody, Arnason until January 25 and Gudjonsson until January 21, their lawyers told Icelandic media.

Three other ex-Landsbanki executives -- former chief corporate accountant Elin Sigfusdottir, former brokerage head Steinthor Gunnarsson, and former chief of securities Yngvi Orn Kristinnsson -- were also taken in for questioning by police on Thursday but were released.

Hauksson opened the investigation into Landsbanki's spectacular collapse last October.

The bank was one of Iceland's three main banks that all went belly-up in October 2008, and were taken over by the country's financial supervisory authority (FSA).

The FSA suspects that Landsbanki executives were involved in of market manipulation for nearly five years leading up to the crash.

Prosecutor Hauksson has been charged with the task of shedding light on possible fraudulent and illegal activities among the Icelandic bankers, nick-named "the witches" at the time their businesses were booming across Northern Europe.

In May 2010, a similar probe was launched into the dealings of the one-time largest bank Kaupthing, and several top executives were briefly taken into custody.

The crimes these people are charged with are like child's play compared with what happened in the US during the great moderation. Which is precisely why no justice will ever be sought after our own former and current bank heads. At least no justice that can be dispensed in a court of law. That said, we still have to see real justice in Iceland: In May 2010, a similar probe was launched into the dealings of the
one-time largest bank Kaupthing, and several top executives were briefly
taken into custody. Briefly. Then released. It appears that even the country which attempts to appear a safe-haven from global financial corruption, is not immune from the effects of infinite fiat.

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Ray1968's picture

I wish we would follow their example and let the banks fail.... and make arrests!

downrodeo's picture

I'm with you on that one!

Collectively, America has completely degenerated into an childish state of being. Iceland has demonstrated how adults should act. They've shown that making the right choice is not always easy, but that should not stop one from making it. All the while, we simply pretend nothing is wrong and go about our business. We're a bunch of children.

sgt_doom's picture

Yes, indeed!

America -- the lawless rogue nation state controlled by the banksters.

We require Eva Joly to take time off from the European Parliament to come and investigate the Obama-Bush Administration and the Fed.

That GAO audit of the Fed will take entirely too long -- and we all know the end result:

The USA is simply one colossal-sized Ponzi-Tontine schem.

Buck Johnson's picture

We are a bunch of children and they like it that way.  They have dumbed down the populace to such an extent that logic doesn't make sense anymore unless it's wrapped up in a religious format and under THEIR LOGIC.  Just look at the many big childish movies that have been made in the us for "family" this and family that.  They have made a 21'st century version of bread and circuses for the american plebs.  As long as I'm getting my govt. check or food stamps or whatever I'm satisfied.  And doing this they have made a country of bullies and cowards who will bully anything that looks beneath them but will allow themselves to be robbed blind by banks and businesses and their local govt. and leaders because of this one thing. 

When you are for yourself your by yourself.  And a bully or child or coward can't feel by themselves because it scares them.  Iceland did what they did because they people where at the end of their rope.  They essentially had nothing and where taken for a ride.  It may happen in the US, but we where brought up to be intolerant and childish and ignorant of things.  So we may lose everything, but some idiot will think he's helping by blaming THOSE PEOPLE.  In the end we will end up as a fascists thirdworld country.

Thomas's picture

Death by Bongo (bitchez, of course)

wiskeyrunner's picture

I see the idiots are still posting doom and gloom, you should all be rich by now had you not listened to these cracks.

Internet Tough Guy's picture

The perma-shill niche on this blog is already crowded with Harry and Robo in the lead.

cougar_w's picture

Robo is slacking, tho. When was the last time we had massive boobies? Yeah I don't remember either so it's been at least 36 hours. We need new blood around here. The old shills are simply not pulling their weight.

Logans_Run's picture

Yeah but this guy can't even spell correctly one of my favorite topics, Whiskey

cougar_w's picture

Sure. But you get enough whiskey down yer neck and it becomes w'iskey doesn't matter who you are.

What a mess_man's picture

With 'onlymyopinion' coming up strong...

downrodeo's picture

We can't all be rich, jackass. It is not the case that everyone in the market can make net gains all the time. 

EscapeKey's picture

After the CEO of failed bank Kaputhing was arrested back in May, 

LOL, very good.

bania's picture

Perp walks to the top of of the volcano!

Arius's picture

its a small country 300.000 people nowhere to cannot just turn the life of people upside down and go on as usual...thats my take

cougar_w's picture

Fine, but did he threaten to motherfucking kill the motherfucking police for fucking with him when he's a banker you motherfucking fucks? Bring you helmet midget fuckers cuz it is now so fucking on.

hbjork1's picture


What has sex got to do with it?

And what is "on".

I am not smart enough to figure out what you are saying.

cougar_w's picture

At least spell my name correctly. Droll innuendo looses a lot of it's punch when you don't pay attention to details.

Logans_Run's picture

Like, looses? Sorry Cougar! Otherwise quite good posting.

cougar_w's picture

Not enough w'iskey is my biggest problem.

DaveyJones's picture

what's a little whiskey on the whiskers

philgramm's picture

Iceland arrests a fraudster banker.  We in the USA arrest a guy who calls someone at the CFTC a "fucking midget."  This shit can't get more bizarro.

cougar_w's picture

See here in the USA we have laws against defamation based on stature, sexual orientation, race, and all that.

But fraud, not so much. You can do all the fraud you want. Just don't ever do fraud and then call anyone a midget. Even if they are. You'll get 10 to 20 in the stony lonesome for that shit, right now.

Bastiat's picture

Actually it's still legal to call somebody a "fucking midget" but you should stop short of threatening to kill him.  I'm not sure if it's a "hate crime" to call somebody "a fucking midget" if they are, in fact, vertically challenged.  ;-)

Logans_Run's picture

I call mine a "fucking midget" every morning when I stand before the mirror naked.

bob_dabolina's picture

If Jamie Dimon or Lloyd Blankfien get arrested there will be riots in the streets and the US may need to institute Marshal Law.

Cleanclog's picture

Not riots.  Joyous celebrations!

bob_dabolina's picture

No. Food will become unavailable, there will looting, grandmothers will be shot, dead babies, dead dolphins, puppies slaughtered for their warm fur, 100% unemployment. The world would end.

BTW how many bankers have been arrested to date for the fraud that led to the financial crisis? Oh...there must have been no fraud, my bad.

malikai's picture

Ok. I was all for arresting those crooks until you mentioned dead dolphins and puppies. Now I'm having second thoughts. Maybe they aren't such bad guys after all.

bob_dabolina's picture

....koala bears would go extinct, the antarctic iceshelf would collapse (polar bears would drown), and congress would need to be aroused at 10:00pm to be alerted to these events happening if Jamie and Lloyd don't get what they want.

BTW didn't the number2 at JPM just get a top spot on the Obama administration?

Calmyourself's picture

No polar bears in Antarctica, lotsa penguins, no bears..

bob_dabolina's picture

...penguins will die in droves, lotsa cute penguins dead.

Cleanclog's picture

Yep.  They won't be arrested in the US, cuz here, they do "God's work".  America cloaked in religion.

That God, he's a busy one.  He wins a lot of football games too, according to many of the players. I wonder how he picks which players he'll grace with his powers and why he hates the other team?

I am a Man I am Forty's picture

no shit, he helped auburn win a national championship, cam newton was praying all the time...that shit works (sarc)

shortus cynicus's picture

First of all, the Good would step down to rescue its servants.

Actually, a witch-test should be made: let put them on electric chair and if they will not be rescued, so all this talks about Good's work was a scam.


Problem Is's picture

If it wasn't for fixed market crony capitalism and fraud as a business model...

Jamie & Lloyd would be Amerika's Shoe Shine Boys...

Pullmyfinger's picture

Pray for monetary Armageddon, Apocalypse and a financial comet strike on New York. Sanity and an informed citizenry are just too much to hope for in the USSA.

Dr. Richard Head's picture

I guess Iceland freezing over is what is required for bankers pay for their fraud.  May the bankster rot in hell.

The Rogue Trader's picture

Iceland...I am a fan!

cougar_w's picture

It's a great place, not even very much ice. However I understand that if you want to talk to a banker in Iceland you have to wait until the once-a-month viewing days at the local penitentiary. It's really hurt business there.

Cheesy Bastard's picture

Yeah, why is all the ice in Greenland, and all the green land in Iceland?

cougar_w's picture

Leif Erikson redirecting would-be colonists to green (actually, icy) Greenland was one of the first (and perhaps still greatest) real estate frauds in the Western world.

Iceland (actually green and with little ice) never got over it. Never. You do fraud in Iceland now and they kick you in the balls. And if your name happens to be Erikson they kick you in the balls twice.

Cheesy Bastard's picture

And if your name happens to be Erikson they kick you in the balls twice

Correct.  Then you would go on to found Blueland.  Bring some ice.

cougar_w's picture

And it's outta the park, folks!

alien-IQ's picture

if only their food were not so frightening and their language so impenetrable...I would seriously consider moving there.

Pullmyfinger's picture

Sorry, but you don't have the proper genetic code.

atomicwasted's picture

Their favorite foods are hot dogs and pizza.  I kid you not.  Americans would fit right in.  As for bizarre foods, the only place I ever saw that rotten shark meat called "hakarl" that is supposed to be a local delicacy was at the bazaar next to where the cruise ships come in.

I went to see a movie in Reykjavik a few years ago and they love to crank the volume painfully loud, and make their own intermission halfway through.  The movie just stops and people go out to the lobby for hot dogs, then they turn it back on after 15 minutes or so.  I could get to like that after I got used to it.