The court case against Geir H. Haarde, the former Prime Minister of Iceland, has begun in Reykjavík this morning after a succession of challenges aiming to cancel the case before it started.
Geir is the first world leader to face criminal charges over the global financial crisis – and is specifically accused of negligence in ensuring correct safety procedures were in place that could have prevented the complete collapse of Iceland’s biggest banks in autumn 2008.
Geir and his supporters claim the trial is political scapegoating and that it is unfair to try just one politician for the failings of a whole government – and indeed all of parliament. Supporters of the trial argue, however, that people are angry over the collapse and are still searching for answers and accountability. Geir Haarde may be the only politician on trial, but some bankers have already been sentenced and other investigations are ongoing.
Geir is being tried by the Landsdómur – a special high court which only exists to try government ministers. This is the first time the court has ever conducted a trial; although it has always existed since the Republic was declared.
Former British Prime Minister Gordon Brown described Geir Haarde’s behaviour dealing with the collapse of Icesave as “unacceptable” and “illegal” at the time. Brown was subsequently accused of hostile actions against Iceland which precipitated the fall of Kaupþing bank, which it was hoped at the time would survive. Brown said he saw no other options and acted in Britain’s best interests.
During the first morning of the trial Geir has taken to the witness stand, saying he welcomes the opportunity to talk publicly about the crash. He says that it is now obvious the banks were under-capitalised and that they covered this up in their reports — but said the government had no way of knowing this and saw no need to tear apart reports by independent international auditors. He said that it was clear the banks needed to reduce their risk exposure, but that it was not the government’s job to force them. He says he talked about the issue with the Central Bank of Iceland several times without anything being done about it.