March 5th, 2012
Econintersect: Public protests forced Iceland’s Prime Minister Geir Haarde (pictured) from office at the height of the financial crisis in early 2009. Now the former head of state is preparing for a criminal trial in which the charges are levied that he failed to prevent, and then failed in his prime ministerial duty to manage, the fallout from the crisis. If found guilty he could face up to two years in prison. Haarde is attempting to get the case thrown out, claiming the charges are “political persecution.” He says he will prove himself innocent of all charges if the trial proceeds. Haarde was Prime Minister of Iceland from 15 June 2006 to 01 February 2009.
Follow up:The court that will hear the trial has never before been convened. The body is the Landsdomur court established in 1905 to try cabinet ministers. The procedures will probably be quite political because a majority of the court (8) will be chosen by Parliament and a minority (7) will be jurists. Some have speculated that the trial may end in acquittal for Haarde because of the political nature of the tribunal, the generality of the charges and the fact that the parliamentary vote to press charges was close (33-30). It is also felt that the failure to get enough votes to indict any other ministers considered for trial may weigh in Haarde’s favor.
Cross-border political warfare was raging in late 2008 and early 2009 as the high flying banks in Iceland collapsed after years of aggressive expansion overseas. These banks included Icesave, an internet bank, and that bank’s parent Landesbank. From the BBC:
When Icesave collapsed, the then UK Prime Minster Gordon Brown accused his Icelandic counterpart of "unacceptable" and "illegal" behaviour after Iceland said it could not give a guarantee to reimburse UK customers of the online bank.
In response, Mr Haarde accused the UK government of "bullying" and bringing down one of its other banks after the Treasury froze the assets of Icelandic institutions in the UK.
Some of the Icelandic bank executives were arrested over a year ago. Econintersect has found no news about these individuals since, so presumably they may still be awaiting trial.
- Iceland’s Ex-PM prepares to face trial over crisis (Cassandra Vinograd, Yahoo News, 04 March 2012)
- Iceland’s former premier denies criminal negligence over banking crisis (Rupert Neate, The Guardian, 07 June 2011)
- Iceland ex-PM Haarde to go on trial over 2008 crisis (BBC, 04 March 2012)
- Landsbanki executives arrested in Iceland (BBC, 14 January 2011)
Articles on this topic are found on Econintersect Europe Newspaper page