Minister Investigates Alleged Write-Offs at Kaupthing

The Icelandic Financial Supervisory Authority (FME) is currently launching an investigation on behalf of Minister of Trade Björgvin G. Sigurdsson into rumors that the board of Kaupthing Bank wrote-off the debts of its employees.

Sigurdsson said that it if it true that the board of Kaupthing wrote-off its employees' debts because of their purchase of shares in the bank, the government will ensure that such agreements be annulled, Fréttabladid reports.

“It has to be investigated and concluded quickly,” Sigurdsson said. “All debt-holders have to be treated equally; there will be no special treatments.”

Both RÚV and Stöd 2 reported last night that the debts in question were held by a number of employees and that the amounts were considerable.

Sigurdur Einarsson, former Kaupthing chairman, said he does not have the right to comment on this story, referring to the fact that loans to employees are categorized as trade, and that he is bound by confidentiality agreements in regards to all trade undertaken by the bank.

“I can confirm that it was never discussed by the board,” said former board member of Kaupthing Brynja Halldórsdóttir. Other former board members, who would not be named, said that the matter had been discussed although no decision had been made on writing-off the debts of employees.

All debts that were held by Kaupthing before it was nationalized have now been transferred over to the new state-owned bank, Nýja Kaupthing, according to the bank’s new director Finnur Sveinbjörnsson.

Sveinbjörnsson would not reveal how much the bank’s employees owe Nýja Kaupthing because of their purchase of shares.

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