(July 30, 2014) In a decision issued by the Reykjavik district court on December 12, 2013, two bank directors were among the parties imprisoned for fraud in connection with the banking crisis of 2008. (Dómur: Héraðsdóms Reykjavíkur 12. desember 2013 í máli nr. S-127/2012 [Judgment: Reykjavík District Court December 12, 2013 in case no. S-127/2012], Icelandic Courts’ website.) The men were part of a scheme in which Sheikh Mohammed Bin Khalifa Bin Hamad Al Thani of Qatar made a five percent share purchase in the Kaupthing Bank with money borrowed from the bank itself. (Richard Milne, Icelandic Bank Pair Jailed for Five Years, FINANCIAL TIMES (Dec. 12, 2013) [registration required]; Iceland Jails Former Kaupthing Bank Bosses, BBC NEWS (Dec. 12, 2013).)
The men were convicted under the General Penal Code (Almenn hegningarlög) and the rules on market abuse found in the Icelandic Securities Act (Lög um Verðbréfaviðskipti). (Almenn hegningarlög, No. 19 (Feb. 12, 1940, as last amended Apr. 9, 2013), Althingi [Iceland’s Parliament] website; General Penal Code No. 19, February 12, 1940 (as amended up to Mar. 1, 2004) [in English], Iceland Ministry of the Interior website; Lög um Verðbréfaviðskipti, No. 8 (June 26, 2007), Althingi [Iceland’s Parliament] website; Act on Securities Transactions, No. 108/2007 [in English], Iceland Ministry of Industries and Innovation website.)
The Icelandic banking crisis led to the establishment of a Special Investigation Commission whose mission was to investigate the dealings of the Icelandic banks and Members of the Iceland Parliament. The results of the inquiry, summarized in English, can be found on the Althingi webpage on the Commission report.
Prepared by Elin Hofverberg, Foreign Law Research Consultant, under the supervision of Peter Roudik, Director of Legal Research.