Jon Asgeir Johannesson, the former Icelandic billionaire who controlled failed retail empire Baugur Group hf, was found guilty of tax fraud by Iceland’s Supreme Court.
Johannesson received one year in jail and a fine of 62 million kronur ($484,000) today for a total of nine violations, including not declaring all his capital gains income, profit from shares he sold and violating accounting laws while running Baugur, according to the ruling. Johannesson’s sentence was suspended for two years.
A year before Iceland’s economic meltdown in 2008, Johannesson was the country’s third richest man with a fortune amounting to $1.6 billion. He faces lawsuits from failed lender Glitnir Bank hf, in which he was the largest shareholder. The former Baugur CEO said in a March 12 interview that Glitnir’s lawsuit was based on “fiction” and likely to be dismissed.
Johannesson’s fate tracked the boom-to-bust trajectory of Iceland’s economy. His retail empire in the U.K. and Iceland was built with money borrowed from Glitnir. He epitomized the Icelandic entrepreneur of the 1990s and 2000s, as the island moved away from its reliance on fishing and tourism and became dominated by finance.
When his fortune was at its peak, Johannesson owned a pin- striped private jet, luxury apartments in New York City and London, and a 50-meter private yacht. Since the collapse of his empire in 2008, his fortune has shrunk to about $2 million, he estimates. He earns his living doing consulting work for companies in the U.K., he said in March.
Johannesson’s career started more than two decades ago. Together with his father Johannes Jonsson, he opened a chain of Bonus supermarkets in Iceland in 1989. His arrival in the U.K. retail trade by borrowing to acquire several brands, including the acquisition of toy store Hamleys Plc and department chain House of Fraser Ltd. Both have since been sold.
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