Former Icelandic bank execs jailed for fraud

http://www.icenews.is/index.php/2012/06/15/former-icelandic-bank-ex...

Posted on15 June 2012. Tags: byr bank, Iceland Bank, Iceland supreme court, Icelandic Bank, Ragnar Zophonias Gudjonsson, Thorsteinn Jonsson

The former chairman and the former CEO of the Icelandic Byr Savings Bank have each been sentenced to four-and-a-half years behind bars after being found guilty of fraud. The country’s Supreme Court found that Jon Thorsteinn Jonsson and Ragnar Zophonias Gudjonsson abused their positions as executives at Byr when granting an ISK 800 million (EUR 4.9 million) loan to Exeter Holdings ehf, just as the Icelandic banking system was on the brink of collapse in 2008.

Exeter then used the loan to buy Gudjonsson and Jonsson’s shares in Byr, before putting them up for sale as a collateral guarantee for the loan.

A ruling posted on the Supreme Court’s website said the sentences were harsh because the “magnitude of the offences was significant”. It continued that Gudjonsson’s “infraction was committed under the auspices of his mandate” as Byr’s CEO, and that Jonsson’s action “relieved him from personal guarantees on loans”.