From Iceland — Former Government Official Gets Two Years For Insider Trading

Former Government Official Gets Two Years For Insider Trading

Published April 7, 2011

The former manager of the Ministry of Finance has been found guilty of insider trading and sentenced to two years in prison, in a case that casts doubt on how unaware the previous government actually was to the state of the country’s banks before the collapse.
Vísir reports that according to the charges against him, Baldur Guðlaugsson – who was the manager of the Ministry of Finance in 2008 – sat on a committee that was reviewing the state of the banking system at the time. There, he had access to information that the general public did not.
Based on what he learned, Baldur sold 192 million ISK in shares he had in Landsbanki in September 2008, just before the banking collapse. Numerous witnesses took the stand in the trial, all testifying that the information that Baldur had access to was considered private and confidential.
Numerous former ministers have maintained that the banks in Iceland had concealed their real condition from the government in the time leading up to the collapse; former Central Bank chairman Davíð Oddsson said as much, as did former prime minister Geir H. Haarde.
However, with a top official from the finance ministry clearly privy to information about Landsbanki – and with a government committee formed for the express purpose of analysing the state of the banks – there arises doubt that top government officials could have been as unaware of banking conditions as they claim to have been.

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