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Icelandic bankers sentenced to prison

Xinhua, February 13, 2015 Adjust font size:

A judge from the Supreme Court of Iceland on Thursday sentenced three former managers and one shareholder of Kaupthing Bank to prison in the so-called Al Thani case regarding the Sheikh Mohammed bin Khalifa Al-Thani from Qatar.

Hreidar Mar Sigurdsson, former CEO of the bank, was sentenced to five and a half years in prison. Sigurdur Einarsson, former chairman of the bank, was sentenced to four years.

Magnus Gudmundsson, former CEO of Kaupthing Bank's Luxemborg branch, received a four and a half year sentence and Olafur Olafsson, who was among the largest shareholders of the bank, was also sentenced to four years and a half in prison.

The defendants were not present at the sentencing.

According to the Supreme Court, the defendants in the Al Thani case were found guilty of planned violations, committed by focused intent and unusual recklessness. It also stated that only 2.4 billion Icelandic krona (18 million U.S. dollars) has been paid in two loans up to a total of 17.5 billion Icelandic krona lent to Al-Thani's company.

It was said the marketing fraud had to do with the general public in Iceland and the financial market in the country as a whole.

According to the prosecutor, Bjorn Thorvaldsson, it will be seen whether this sentence will be the precedent in other similar cases.

Shortly before the bank's collapse in 2008, it was announced that the Sheikh had acquired more than five percent of Kaupthing's shares for 25.6 billion Icelandic krona. Sigurdsson said the acquisition showed international confidence in the bank.

A few months later, local media reported that the bank deceived the market and created a false demand for its shares by financed the majority of the purchase itself.

In December 2013, the Reykjavik District Court announced the four defendants were found guilty of breach of trust and market manipulation. Endit