From Iceland — Special Prosecutor to Pursue Landsbanki

Special Prosecutor to Pursue Landsbanki

Published October 21, 2010

Special prosecutor Ólafur Þór Hauksson will now be investigating whether or not managers of the former Landsbanki engaged in deliberate and illegal market manipulation.
As reported, the Financial Supervisory Authority of Iceland (FME) has submitted findings to the Special Prosecutor regarding market manipulation conducted by former Landsbanki officials. There is strong evidence indicating, Vísir reports, that former Landsbanki officials purposefully engaged in illegal market manipulation. The charges include touting false information about the status of the bank, and giving an inflated outlook on stocks owned by the bank managers themselves.
The case bears a strong resemblance to charges levied against Kaupthing, it seems. The FME contends that former bank managers bought stocks in their own companies, and later sold them to select clients at an inflated price, with the banks themselves financing the buyers. In this way, they artificially increased the value of the stocks in their own company.
The Special Prosecutor’s previous investigation of former Kaupthing managers brought international attention, with arrests of former bank managers made, and one – Sigurður Einarsson – hiding out in the UK with an Interpol warrant for his arrest hanging over his head. That investigation is still ongoing.

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