uti.is 19 Mar 2013:Two Big Market Manipulation Cases Coming Up in Iceland

Category: Newspaper & Media Reports

The Office of Special Prosecutor in Iceland has brought charges in two large market manipulation cases – one against Kaupthing managers, another against Landsbanki managers. Those charged re Kaupthing are, according to Icelandic media, are Kaupthing’s chairman Sigurdur Einarsson, CEO Hreidar Mar Sigurdsson, Ingolfur Helgason director of Kaupthing Iceland, Magnus Gudmundsson director of Kaupthing Luxembourg, Bjarki Diego head of lending, three so far unnamed employees in prop trading and one in retail banking.

From Landsbanki there are CEO Sigurjon Arnason, Elin Sigfussdottir and four traders. The charges have not been published yet.

Allegedly, these cases centre on how the banks themselves, through various channels, owned a large part of the banks’ shares, meaning that market movements did not at all reflect the reality. I expect the charges to come out later this week and will then write about these cases in detail.

So far, no large case has surfaced regarding Landsbanki although the SIC report mentions many interesting transactions related to that bank, as well as the other banks. Icelog has earlier reported on another large Kaupthing case, the so-called al Thani case (here is a link to earlier Icelogs on that case).

According to the SIC report, 74-80% of trades on the Icelandic Stock Exchange were generated by the three banks. According to Icelandic media, some well known cases are connected to the new charges, such as a company called Imon, allegedly used to influence Landsbanki shares. Here is an earlier Icelog where Imon is part of the story and gives an idea what has been investigated.

An interesting aspect of these cases is that the alleged manipulation started well before 2008. This is made very clear in the SIC report.

read Sigrun Davidsdottir's blog and comments here


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