Iceland is showing the world that it is possible to prosecute bankers.
Four former executives of Kaupthing bank, which failed during the Icelandic financial crisis, had convictions upheld this week. The bank’s former chief executive, Hreidar Mar Sigurdsson; former chairman, Sigurdur Einarsson; former CEO of Kaupthing, Luxembourg Magnus Gudmundsson; and second largest shareholder, Olafur Olafsson, were sentenced to four to five and a half years in prison.
Each defendant must also pay varying amounts in court and legal fees.
The newest convictions make 26 total bankers combined being sent to prison for their role in iceland’s financial collapse.
Special prosecutor to the case, Olafur Hauksson told Reuters UK, ”This case…sends a strong message that will wake up discussion. It shows that these financial cases may be hard, but they can also produce results.”
Hauksson was a policeman from a small fishing village before being asked to become the special prosecutor in cases against corrupt bankers due to the fact that no other applicants wanted to take on the responsibility.
Of the seven cases involving bankers that have made it to the Supreme Court, six of them have been upheld. Five more are due to be heard and 14 are awaiting possible charges.
The verdict is the heaviest for financial fraud in Iceland’s history.
Iceland’s financial collapse came in 2008, seven years after their deregulated their financial sector. This was a similar step to what former President Bill Clinton did in the United States, though we have yet to prosecute any bankers for their role in the collapse, resulting in them continuing to operate with little oversight.
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