Money laundering at old Icelandic banks under investigation

Work on the case against bankrupt Glitnir Bank is going well, according to Iceland’s special prosecutor; who says that 134 people have been questioned in the last six days.

The interrogations come in the wake of the arrest of former Glitnir CEO Lárus Welding and two of his former colleagues earlier this month.

Special prosecutor Ólafur Þór Hauksson and his team have been investigating breaches of the law in the run up to the Icelandic banking crash for three years and many of the cases under investigation are directly or indirectly related to the three major fallen banks, Glitnir, Landsbanki and Kaupþing.

Ólafur told RÚV’s Kastljós current affairs programme that several cases relate to alleged money laundering, when funds were transferred between accounts between undefined individuals or companies.

He said that although some of the money laundering cases potentially relate directly to the banks, his office’s use of phone tapping has stopped since the practice became public knowledge and the subject of national discussion. Evidence gathered that way simply dried up once people guessed their phones were tapped. Following the News of the World phone tapping revelations in the UK, Ólafur confirmed that phone taps were not used against people not directly under investigation.

Ólafur Þór still expects his 90-strong team of investigators will be able to finish their investigations in 2014; but warned that 2012 will be extremely busy.