Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Ex-Glitnir Executives Get 9-Month Jail Sentences for Fraud

Don't Miss Out —
Follow us on:

Dec. 28 (Bloomberg) -- Larus Welding, the former chief executive officer of failed Icelandic lender Glitnir Bank hf, and Gudmundur Hjaltason, an ex-director at the bank, were sentenced to nine months in jail for fraud, a court ruled.

The executives were sentenced today by the Reykjavik District Court. They were indicted 12 months ago for having “misused their position and grossly endangered the bank’s funds” by lending 102 million euros ($134 million) to Milestone ehf without guarantees or collateral, the prosecutor said then.

The executives are the first bankers from Iceland’s three-largest lenders to be sentenced to jail for activities related to the island’s financial and economic collapse in 2008. Glitnir was the first of Iceland’s biggest banks to fail, triggering the biggest recession in six decades and sending the krona down as much as 80 percent against the euro on the offshore market.

Welding was this month also indicted on separate charges for his role in approving a 6 billion-krona ($47 million) loan to holding company FS38 ehf.

Welding and Hjaltason couldn’t be immediately reached through their lawyers, Ottar Palsson and Thordur Bogason, respectively.

To contact the reporter on this story: Omar R. Valdimarsson in Reykjavik at valdimarsson@bloomberg.net

To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.