Former Icelandic Prime Minister to face charges over banking crash

Iceland’s Althingi parliament voted unanimously (63 votes for, zero against) to endorse the findings of the committee which looked into the so-called black report on the banking crisis. But the four ex-ministers recommended for prosecution by the committee were voted on individually. All MPs were present and voted.

In the first vote, it was confirmed that the Landsdomur high court will be convened for the first time ever to try former Independence Party Prime Minister Geir H. Haarde (33-30).

The second parliamentary vote concluded that former head of the Social Democrats and former Minister for Foreign Affairs, Ingibjorg Solrun Gisladottir will not be brought in front of the court (29-34).

Next, parliament also voted to spare former Minister of Finance for the Independence Party, Arni M. Mathiesen from the Landsdomur (31-32).

Finally, as expected, ex-Social Democrat Minister for Trade and Commerce, Bjorgvin G. Sigurdsson has also been spared (27-35).

This means that only the former PM will have to answer for his alleged misconduct in the lead up to, during and following the banking crisis.

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23 Responses to “Former Icelandic Prime Minister to face charges over banking crash”

  1. loki-ish says:

    My only question is why does not the rest of the world see as clearly as the Islensk on this key issue?

    I am proud to have once lived and worked in your country. (The Perkins clip “Economic Hitmen”* is so relevant to your present dire situation). I pray fervently that you will have the resources to all pull through winter intact.

    Thank you for clearly showing the way to stand up to the rapacious IMF.

    * http://www.youtube.com/watch?v=n7Fzm1hEiDQ

  2. Laaz Molinari says:

    I love this whole story; it would be so nice to see politians being punished. It is becoming too popular to betray the people. Anyway, I hope this case will serve as a presendence for all those so-called democracies. Power to the people!

  3. Bjarni says:

    To Burt:

    The points you mentioned are good, but in this particular case they will probably not be applicable. Landsdomur is a special court, that can only be convened by Althingi, as specified in the 14. article of the Icelandic constitution.

    14. gr. Ráðherrar bera ábyrgð á stjórnarframkvæmdum öllum. Ráðherraábyrgð er ákveðin með lögum. Alþingi getur kært ráðherra fyrir embættisrekstur þeirra. Landsdómur dæmir þau mál.

    http://www.stjr.is/stjornarskra/

    Loosely translated it says:

    14. Ministers bear responsibility for all governmental actions. Ministerial responsibility is decided by laws. Althingi can charge ministers for the operation of their office. Landsdomur will judge those cases.

    Then there have been various other laws passed, that define more closely exactly what the responsibility of each minister is and how Landsdomur is convened. While the ministers in question cannot really be held responsible for mistakes and bad actions of the banks, they are indeed responsible for enforcing the laws and regulations that are in place. So the prosecution and the defence will center about whether Geir Haarde did or did not fulfill his job responsibilities as a prime minister.

    Regarding Bjorgvin, I personally believe that he should be held accountable, even if he was kept out of the loop. If he did not think he was kept from doing his job, for whatever reason, he should have resigned. Same goes for Arni Mathiessen, he as the finance minister should be held accountable for not doing his job.

    The only one that I would have voted No on was Ingibjorg Solrun, as I think her point was correct, that as a foreign minister, she did not have any LEGAL responsibility regarding managing and regulating the banks. That does not absolve her of the political responsibility for the crash, but those are supposed to be resolved in the voting booth, not in court.

  4. Bromley86 says:

    >So Brumley, when will we see tread this in context of certain other ex-Prime Minister

    This is Iceland’s moment Fisy, don’t try to spoil that :P .

    Seriously, there’s been no call for it and I’d put it to you that, seeing as you like comparing to other countries, Iceland’s collapse was of an order of magnitude larger than the UK’s.

  5. Peter - London/Krakow says:

    “this sounds quite political”

    Well of course it is, the only way he can be prosecuted is by a law that politicians have to vote. If there was a proper court that could take action, it would have. But politicians instead set-up a legal system that allowed them to decided on, effectively , their own guilt. Judge, prosecution and jury with the added option of claiming its unfair.

    “Yes, I mean Mr G Brown.”

    Nobody has ever accused him of any sort of misconduct or crime. Incompetence in handling the UK economy and allowing a bunch of Icelandic thieves to operate in the UK, certainly.

  6. Fisy says:

    >fear and anger among the politicians now, actually quite entertaining to watch.

    I have to agree in general — politicans need a balance on they behaviour and being not voted for every 4 years is just not enough. Referendums are far best idea though extradordinary times cause for the extraordinary measures.

    Although I hav to say it is god send for Jóhanna Sigurðardóttir and Össur Skarphedinsson who desparetely do want attention away from the faltering EU bid and way they are pushing through changes now in agriculture to be enforce all EU regulations despite that voters have not approved EU member ship and are more against it e very day as they do learn more about EU and its ways .

    As to Geir in front of parlimentary ” high court “, The Black Report was very thorough and those that do sit in the government seats need this kind of shock to the system although we hav seen split voting from Social Democrats in way that shows the internal factions wanting to get even with Ingibjörg Sólrún — no love is lost between Ingibjörg who wants EU application stopped before Social Democrats are made to look stupid and incompentent at best — vs Össur the knee jerk EU phile.

    When Geir does appear it will again show and contrast the Icelandic ways to those of other countries

    Specifically when was last time Minister in UK was held accountable in way like this ? And let alone a Prime Minister despite there having been very good candidate of this from last one 2007- 2009 that was there in UK.

    I think Geir does not deserve this dubious honour alone — although the buck should stop with the PM in matters of government failure as highest one responsible.

    And I do expect that the High Court itself to be fair and impaertialy convened although clearly this impeachment process of selection has been very political and partisan.

  7. Fisy says:

    So Brumley, when will we see tread this in context of certain other ex-Prime Minister :

    ” This means that only the former PM will have to answer for his alleged misconduct in the lead up to, during and following the banking crisis. ”

    Yes, I mean Mr G Brown.

  8. Burt says:

    As a foreigner from afar, this sounds quite political, I need to ask an obvious question (more to clarify Bjarni’s remark): “It is important to remember that the ministers were actually in most cases not being accused to have “something wrong”, but rather that they did NOT take the necessary actions, when faced with the clear economic danger the country found itself in…”
    So, to prove THE CASE, is it not necessary to demonstrate beyond the shadow of reasonable doubt that bank regulatory requirements were sidestepped or ignored e.g. adequate reserves, that illegal loans were siphoned out of the banks for personal use without adequate collateral, that meetings which led to a conspiracy were attended by individuals, that laws, not judgments, were remiss? It seems that this court is rather like the Paper Trading accounts of beginning stock traders. All bang and no buck! Why not send this thing to another venue like the International High Court where the outcome relies more on the evidence rather than opinion or political bias?
    Furthermore: “So the question here basically was, should the trade minister be held accountable for his ministry lack of regulatory enforcement of the banks, while many important reports, briefings, and other communications were held back or not shared with him.”
    This sounds like a cat chasing his tail! Where the cat stops and the chase begins “…that is the question.” Shakespeare

  9. Axel says:

    I would have liked to see all 4 of them stand trial, the only one of those 4 who has any itegrity is Bjorgvin, he was the only one to resign from the old Gov, the rest had to be kicked out.
    It apparently angers Geir that a 100 year old law who has never been used before is being used to prosecute him, as expected he insist he is innocent.
    There is fear and anger among the politicians now, actually quite entertaining to watch.

  10. Bjarni says:

    This was a very historic vote for Iceland on several different levels, especially since Landsdomur has never before been convened in Iceland.

    The vote itself was actually quite political, in that all Left-Greens (15) and The Movement MP’s (3) voted for the prosecution, while all Independence MP’s (16) voted against prosecution for each of the four ministers. The Progressive party MP’s (9) also voted the same way for all four ministers, but splitting the vote to 6 for prosecution and 3 against.

    The only party that varied their votes between the four ministers were the Social Democrats (20). They splitted 10-10 for Geir (prime minister, IP), 7-13 for Arni (finance minister, IP), 5-15 for Ingibjorg Solrun (foreign minister, SD) and 3-16 for Bjorgvin (trade minister, SD).

    An interesting side point here, is that it has usually been the Social Democrats that vote all the same way on difficult votes, while the other parties split their votes (EU and Icesave would be a good examples of this).

    There were some accusations after the vote made by Independence party members, that the Social Democrats were playing politics, by strategically letting their own ministers off the hook, while voting to prosecute the IP ministers, but there were clearly more problems with the prosecution of the SD ministers.

    First, regarding Ingibjorg Solrun, the foreign minister. She seemed to be included more because she was the chair of Social Democrats at the time and therefore the highest ranking member of the junior party in the coalition government. But she made a strong argument in her response, that there should be a clear distinction made between legal responsibility (as a minister) and a political responsibility (as a party chairman/woman). Ingibjorg Solrun as the foreign minister, simply did not have any responsibility in the government, over either the banks or the economy, at least not from a legal standpoint.

    Regarding Bjorgvin, as the trade minister, he on the other hand clearly could potentially be held legally responsible for managing and regulating the banks in Iceland. But there was some evidence in the parliamentary investigative report (rannsoknarskyrsla) that Bjorgvin was systematically kept “out-of-the-loop” by the other ministers, possibly even with the knowledge of Ingibjorg Solrun herself (she has objected to this). So the question here basically was, should the trade minister be held accountable for his ministry lack of regulatory enforcement of the banks, while many important reports, briefings, and other communications were held back or not shared with him.

    Arni Mathiessen, the finance minister was actually quite lucky, just squeaking past prosecution on a narrow 31-32 vote. The finance minister is responsible for government finances (which are now off the deep end with massive deficits and debt), and the Central Bank (which went bankrupt) is also partially under his domain. He clearly played at least some role in the run-up and during the crash (the fateful phone call with Alastair Darling for example), but there is a debate this was criminal negligence or just plain incompetence.

    Then we have Geir Haarde, the prime minister and the only one that was voted to be prosecuted. He does not personally believe he is in any way personally responsible as the crash was solely caused by the banks, and the Independence Party definitely agreed with him (they all voted against prosecution). He did interviews on all the news channels this evening were he hinted that the prosecution was instead politically motivated and he was being scapegoated.

    But Geir Haarde was after all the prime minister, and the country did suffer near complete economic collapse under his watch. In the end the buck should therefore stop with him. Whether the mistakes made by his government rises up to be considered criminal, remains to be seen and will still have to be proven in court (Landsdomur).

    It is important to remember that the ministers were actually in most cases not being accused to have “something wrong”, but rather that they did NOT take the necessary actions, when faced with the clear economic danger the country found itself in during the run-up to the crash in 2008.

  11. Bromley86 says:

    I’m trying not to ham this up, but is this not a total betrayal of the people?
    http://www.icenews.is/index.php/2010/09/27/icelanders-want-former-ministers-to-face-trial/

    Reyk Grape has a link to & explanation of the voting:
    http://www.grapevine.is/News/ReadArticle/Former-PM-to-Be-Charged-with-Negligence

    Simplified, LG & Movement voted 100% impeachment, Independence voted 100% not. Progs were 67% all, 33% none. So it’s the voting of the SD that counts. And their leader said that she thought it shouldn’t happen. Fair enough, she voted that way, but her statement will have altered the vote on Arni by the 1 needed.

Trackbacks/Pingbacks

  1. [...] Former Icelandic Prime Minister to face charges over banking crash Posted by Garbagemin Franklin at 4:44 pm [...]

  2. [...] charged with “misconduct in the lead up to, during and following the banking crisis,” reports Ice News.  Parliament voted to prosecute only Haarde for negligence, under a 100-year-old law that has [...]

  3. [...] charged with “misconduct in the lead up to, during and following the banking crisis,” reports Ice News. Parliament voted to prosecute only Haarde for negligence, under a 100-year-old law that has never [...]

  4. [...] charged with “misconduct in the lead up to, during and following the banking crisis,” reports Ice News. Parliament voted to prosecute only Haarde for negligence, under a 100-year-old law that has never [...]

  5. [...] charged with “misconduct in the lead up to, during and following the banking crisis,” reports Ice News. Parliament voted to prosecute only Haarde for negligence, under a 100-year-old law that has never [...]

  6. [...] the bankers BILLIONS MORE. . Former Icelandic Prime Minister to face charges over banking crash Former Icelandic Prime Minister to face charges over banking crash | IceNews – Daily News . Iceland's politicians forced to flee from angry protesters Protesters took to the streets of [...]

  7. [...] zusätzliche Wut sorgt ein Parlamentsbeschluss, demzufolge nur gegen den ehemaligen Premier Geir Haarde Anklage wegen seiner Mitverantwortung an [...]

  8. [...] charged with “misconduct in the lead up to, during and following the banking crisis,” reports Ice News. Parliament voted to prosecute only Haarde for negligence, under a 100-year-old law that has never [...]

  9. [...] with “misconduct in the lead up to, during and following the banking crisis,” reports Ice News. Parliament voted to prosecute only Haarde for negligence, under a 100-year-old law that has never [...]

  10. [...] reports: Iceland’s Althingi parliament voted unanimously (63 votes for, zero against) to endorse the [...]

  11. [...] Former Icelandic Prime Minister to face charges over banking crash Iceland’s Althingi parliament voted unanimously (63 votes for, zero against) to endorse the findings of the committee which looked into the so-called black report on the banking crisis. But the four ex-ministers recommended for prosecution by the committee were Read more at IceNews – Daily News [...]


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