Kaupþing Managers Gave Huge Loans Just Before Bank Crash - The Reykjavik Grapevine

Kaupþing Managers Gave Huge Loans Just Before Bank Crash

Published January 4, 2011

A copy of the minutes of a meeting at Kaupþing in September 2008 shows that top managers there made the decision to loan out millions to a Russian tycoon, who in turn parcelled the money out to people connected to Kaupþing.
RÚV, who are in possession of the minutes, report that among those present at the meeting were former director and Interpol fugitive Sigurður Einarsson and former bank manager Hreiðar Már Sigurðsson. The meeting, which took place on 24 September 2008, was called together to make some fairly momentous and possibly damaging financial decisions.
It was decided then that Kaupþing would lend 450 billion ISK (just under 4 billion USD today) in all to various parties, including people close to Kaupþing’s own management. Russian tycoon Alisher Ushmanov alone received 270 billion ISK. The express purpose of this loan, according to the minutes of the meeting, was for him to then distribute portions of this money to some of Kaupþing’s wealthiest clients.
RÚV also reports that the atmosphere at the meeting had been relaxed, with those present discussing the strong state of financial affairs at the bank. The day after the meeting, however, it was decided to exempt any of the bank’s key figures from any responsibility related to purchases of stock in the company. As is now well known, a few weeks later the economy collapsed.
Both Sigurður and Hreiðar have been questioned last year by the special prosecutor investigating the bank collapse, but as of yet no formal charges have been pressed against them.
Related articles:
Former Kaupthing Chairman: Charges “Without Merit”
Kaupthing Investigation Spreads into British Business World
Former Kaupthing Chairman Denied Appeal in Supreme Court
Lawyer for Former Kaupthing Chairman Calls Special Prosecutor “Cowboy”
Former Kaupthing Director: “I Won’t Come to Iceland Voluntarily”
Two More Former Kaupthing Officials Arrested – UPDATE: Former Kaupthing Chairman Wanted by Interpol
Former Kaupthing Director Arrested – UPDATE: Another Kaupthing Director Arrested.

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