From Iceland — Former Financiers Get Prison Sentences

Former Financiers Get Prison Sentences

Published June 12, 2012

Two former bank managers were handed sentences of four and a half years in prison each for engaging in fraud prior to the crash.
According to Bloomberg, former Byr Savings Bank chairman Jón Þórsteinn Jónsson and the lender’s ex-Chief Executive Officer Ragnar Zophonías Guðjónsson lent 800 million ISK to Exeter Holdings ehf in 2008. This loan was, in turn, used to buy the two’s shares in Byr.

“In deciding the punishment” the Supreme Court took account of the fact that the “magnitude of the offences was significant,” according to the ruling posted on the Reykjavik- based court’s website. Jonsson’s action “relieved him from personal guarantees on loans” and Gudjonsson’s “infraction was committed under the auspices of his mandate” as Byr’s chief executive officer, according to the ruling.

The two are not the first to go to prison for pre-crash shady dealings. Last February, former Permanent Secretary of the Ministry of Finance Baldur Guðlaugsson was sentenced to two years for insider trading, due to business transactions he made just before the crash that were based on information he and very few others were privy to.

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