# Icelandic Bankers jailed



## dewdrop (29 Dec 2012)

I t is reported that 2 bankers in Iceland were jailed for reckless business loans.  Could such a prosecution be possible or succeed in this country?


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## mercman (29 Dec 2012)

dewdrop said:


> Could such a prosecution be possible or succeed in this country?



And why not ?? The scope should be extended to Deception, Misrepresentation, Extortion, and Fraud including the other attributes these reckless persons invoked the public with.

But we do have a lame duck regulation system in this country. Personally, I have always maintained that unless and until heads roll in this country, we will never pick ourselves up and move away from the negativity that has enveloped the people of Ireland.


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## Leper (1 Jan 2013)

While I believe many bankers should be jailed in Ireland the reality is that not only will they not, but we had many of them retired with large lump sums + pensions. Furthermore, some of our politicians can continue to be crooked and need not fear being called to answer.

Fair play to the Iclandic people for jailing corrupt and uncareful bankers.


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## Jim2007 (1 Jan 2013)

Don't believe everything you read!  These two were convicted of fraud, plain and simple, nothing more exciting than that.  These two would have been convicted in the same manner regardless of what happened to the bank, because they were just common criminals.

This kind of thing often happens when a company collapses because the people committing the fraud are no longer able to keep it hidden.

Always remember that papers are commercial enterprises too and that sensational headlines are the best way to sell papers....


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## jpd (1 Jan 2013)

2013 -the year Seanie goes to prison 

- for a few months anyway :-(


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## dewdrop (2 Jan 2013)

I often wonder when people cry out to have some bankers jailed what offence did they commit under our legislation.  I have no love for such people as my nest egg of bank shares are now worthless due to crazy lending which i think is not an offence?


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## jpd (2 Jan 2013)

Seanie is accused of providing false information to the auditors with regard to directors' loans which is an offence under the Company Acts.

On the face of it, it would seem an open and shut case - it is hard to see what defence he could put up against the available evidence.


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## Jim2007 (2 Jan 2013)

jpd said:


> Seanie is accused of providing false information to the auditors with regard to directors' loans which is an offence under the Company Acts.
> 
> On the face of it, it would seem an open and shut case - it is hard to see what defence he could put up against the available evidence.



First of all, we have not actually seen the evidence, so we can't comment on it's quality....

Secondly, he is a fully qualified accountant, with public practice experience so I'd be surprised if he blatantly provided false information in such a clear cut manner as is suggested.

Thirdly I doubt that as the CEO of a bank, he would have had day to day contact with the audit seniors or audit manager doing the audit, so there is a chance that the information was via a third party....

Knowing something and proving it in a court of law are two very different things, so while I'd be disappointed if he does not go to jail, I would not be too surprised if he managed to get out of with a lessor punishment.


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## jpd (2 Jan 2013)

Are you suggesting that his loans were moved from Anglo to PTSB prior to the year end without his knowledge?


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## dewdrop (2 Jan 2013)

Is this discussion possibly entering dangerous ground as the matter is before the Courts?


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## Leper (2 Jan 2013)

dewdrop said:


> I often wonder when people cry out to have some bankers jailed what offence did they commit under our legislation. I have no love for such people as my nest egg of bank shares are now worthless due to crazy lending which i think is not an offence?


 
I am not a lawyer, but I am not a fool either. I do not believe that the vast amounts of money "loaned" to people who could barely handle their telephone bills were done so in a bona fide sense. There was reckless borrowing allowed by the banks. They must have known that the bubble was about to bust as they are not fools either. I am not convinced that everything they did was legal and I believe with a little scratching at the surface at what they did will expose the real truth of what went on.

Let's face it, if somebody is caught shoplifting to feed a child the person faces a jail sentence. The banks because of their unrelenting greed loaned money like it was confetti. You dont have to be a trained lawer in any country to know that what was done was reckless and illegal. When I see bankers jailed (managers, assistant managers, the lot of those who participated in what can be called a contrived greedy scam I will once again believe in Ireland). People were diddled out of their money. How many of us have homes that are now worth less than half the value paid? You dont have to be an artist to draw conclusions here.


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## Jim2007 (2 Jan 2013)

jpd said:


> Are you suggesting that his loans were moved from Anglo to PTSB prior to the year end without his knowledge?



I'm not suggesting anything of the sort, I'm simply pointing out that it may not be as easy to prove as people think...


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## Dermot (2 Jan 2013)

Now that the Government has an element of control on the banks is it not time to legislate as to how extraordinary bonuses are paid. Bonuses were effectively paid out on how much was lent and the banks paid their employees on notional profits and on loans that were supposedly performing loans. There were huge bonuses paid out on loans that did not perform in reality and nobody had to repay their bonuses when reality set in. There has to be a an independent way of doing this and not let banks control this. There should be some system where this is done over a rolling 10 year period which would take account of losses as well as profits. I do not fully accept that you cannot find good people to run a bank if we do not pay basic rates over €500,000. We did not get great ones when we paid 4 and 5 million. There are plenty of people who would be quite capable of doing it for 500,000 or less. There was no big rush to take on the geniuses that have departed the banking scene. The crowd at the top of the banking sector like to put it across that there would be no applicants unless these fantasy salaries are kept in place


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## Jim2007 (2 Jan 2013)

Leper said:


> I am not a lawyer, but I am not a fool either. I do not believe that the vast amounts of money "loaned" to people who could barely handle their telephone bills were done so in a bona fide sense. There was reckless borrowing allowed by the banks. They must have known that the bubble was about to bust as they are not fools either. I am not convinced that everything they did was legal and I believe with a little scratching at the surface at what they did will expose the real truth of what went on.
> 
> Let's face it, if somebody is caught shoplifting to feed a child the person faces a jail sentence. The banks because of their unrelenting greed loaned money like it was confetti. You dont have to be a trained lawer in any country to know that what was done was reckless and illegal. When I see bankers jailed (managers, assistant managers, the lot of those who participated in what can be called a contrived greedy scam I will once again believe in Ireland). People were diddled out of their money. How many of us have homes that are now worth less than half the value paid? You dont have to be an artist to draw conclusions here.



So under what law would charge them???  And who would you charge, the bank manager, the advisor, the teller, members of the credit committee perhaps.....

And even when it comes to it, one could argue that the property valuer is the real culprit since he is the one that was claiming to be the market expert and should have known that the market was way overheated and as such should have warned the others that the property was way over valued...  

The reality is that in a bubble everyone seems to get carried along and anyone trying to raise a red flag gets knocked over in the stampede!


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## Conan (2 Jan 2013)

Lets follow Leper's logic:
- in 2007 I see a house I like advertised by an estate agent
- Based on my then income I get Bank approval for a mortgage
- The Bank get an independent valuation
- I get a surveyors report
- I employ a Solicitor
- The house is now valued at 60% of the 2007 value

So based on Leper's logic the following should be jailed:
- the estate agent should have known that the market was a bubble
- the Bank Manager, the Bank lending committee etc must have known
- the independent valuer must surely have known
- my surveyor must have known
- my Solicitor must have known
- and whilst I am in a jailing mind, what about the original owner of the house ( an Economist) he surely must have known

As Bertie said, no one told me it was a bubble. So based on my one house I think I can justify jailing some 10 individuals. After all how was I supposed to know. I won't be unreasonable by suggesting that the Bank clerks  or the legal assistants I dealt with should also face jail.

On the basis of my one house I think that we can easily come to jailing some 7,500 people (allowing for many individuals being involved in multiple sales). At least the legal profession and the Prison Officers Assoc will be delighted.


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## Leper (2 Jan 2013)

Conan said:


> Lets follow Leper's logic:
> - in 2007 I see a house I like advertised by an estate agent
> - Based on my then income I get Bank approval for a mortgage
> - The Bank get an independent valuation
> ...


 
Let's keep the issue to Bankers. The like of estate agents, solicitors etc are a side issue in this and if necessary let these be jailed also if some law can be found that they have broken. But, the bankers were over greedy and behaved irresponsibly (to say the least) setting off a chain reaction which cost many good people lots of money etc. I dont believe all the bankers acted within the law and where proven should be made anwser for their misdeeds.


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## mercman (2 Jan 2013)

There might be some merits on the basis of your description. The Banks fulfilled a requirement and broke their own rules in doing so. In fact what about the circumstances where they refused to lend to honorable people but chose to lend to the high risk category. In fairness to the bankers, I have as yet to hear any stories of where  anybody was forced to take a loan. In cases like this they were simply  doing their jobs.

Better still, what about the Bankers that enticed persons into making investments and told them pure lies and spoof. Deception and misrepresentation springs to mind.

They should go to jail, simple as that.


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## Conan (2 Jan 2013)

Leper,
So sticking only with Bankers ( though that seems very selective) in the case of lending arrangements (whether commercial or residential)  what laws were broken? What illegality happened?
Fortunately or unfortunately, being greedy is not illegal. Neither is an inability to predict the future. In fact, incompetence is not illegal. 

One does not have to go back to long to when Banks (or Bankers) were vilified for their "conservative" lending practices. Now some want the same Bankers jailed for not being conservative enough. 
If bankers were to be villified (or even jailed) for excessive lending, what responsibility does the borrower have. In my example above (I have seen a house I like, suitable for my growing family) should the Bank Manager have refused my loan application? At the time what would my reaction have been? Would I have been happy with such a decision? Would I have gone to another Bank that might have said "Yes"?

20/20 hindsight is far more prevalent now than it was in the early naughties.

Despite the above, I do think that there appear to be evidence of illegality in certain high profile cases (share support arrangements, failure to disclose information as required by the Companies Act etc).


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## Conan (2 Jan 2013)

Leper,
So sticking only with Bankers ( though that seems very selective) in the case of lending arrangements (whether commercial or residential)  what laws were broken? What illegality happened?
Fortunately or unfortunately, being greedy is not illegal. Neither is an inability to predict the future. In fact, incompetence is not illegal. 

One does not have to go back to long to when Banks (or Bankers) were vilified for their "conservative" lending practices. Now some want the same Bankers jailed for not being conservative enough. 
If bankers were to be villified (or even jailed) for excessive lending, what responsibility does the borrower have. In my example above (I have seen a house I like, suitable for my growing family) should the Bank Manager have refused my loan application? At the time what would my reaction have been? Would I have been happy with such a decision? Would I have gone to another Bank that might have said "Yes"?

20/20 hindsight is far more prevalent now than it was in the early naughtiest.


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## Leper (2 Jan 2013)

Conan said:


> Leper,
> So sticking only with Bankers ( though that seems very selective) in the case of lending arrangements (whether commercial or residential) what laws were broken? What illegality happened?
> Fortunately or unfortunately, being greedy is not illegal. Neither is an inability to predict the future. In fact, incompetence is not illegal.
> 
> ...


 Thank you Conan.  I am not a lawyer as I pointed out earlier.  So let's say the Bankers did not behave in any way underhand and let's not prosecute them.  Then you must say they acted responsibly and should bear no responsibility at all.  So, I am wrong.  Thanks to all the Bankers and I am sorry if I offended any of them.


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## Jim2007 (2 Jan 2013)

Leper said:


> Let's keep the issue to Bankers. The like of estate agents, solicitors etc are a side issue in this and if necessary let these be jailed also if some law can be found that they have broken. But, the bankers were over greedy and behaved irresponsibly (to say the least) setting off a chain reaction which cost many good people lots of money etc. I dont believe all the bankers acted within the law and where proven should be made anwser for their misdeeds.



So selective justice based on your opinion..... seriously, perhaps we should just start sending people direct to jail and avoid the expense of a trial!


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## Leper (3 Jan 2013)

Jim2007 said:


> So selective justice based on your opinion..... seriously, perhaps we should just start sending people direct to jail and avoid the expense of a trial!


 
OK! OK! - I am being selective. We have to start somewhere. Let's start with the Bankers. Let there be a pogram of jailings through the courts. Then we can start on the rest. We have a high rate of suicide in Ireland and I cannot be convinced that pressure by banks because of loans issued by the same banks have nothing to do with their situation.

Otherwise, the Bankers etc get away scott free and the banks will behave dreadfully like they did again. Why should the guilty get away with what they have done? I dont care how full the prisons get. Our children and grandchildren will not have paid the debts the irresponsible bankers caused.


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## Jim2007 (3 Jan 2013)

Leper said:


> OK! OK! - I am being selective. We have to start somewhere. Let's start with the Bankers. Let there be a pogram of jailings through the courts. Then we can start on the rest. We have a high rate of suicide in Ireland and I cannot be convinced that pressure by banks because of loans issued by the same banks have nothing to do with their situation.
> 
> Otherwise, the Bankers etc get away scott free and the banks will behave dreadfully like they did again. Why should the guilty get away with what they have done? I dont care how full the prisons get. Our children and grandchildren will not have paid the debts the irresponsible bankers caused.



Look you are fully entitled to your opinions, but unless you can answer three questions, that is where it stops:

- Who are you going to charge
- Under what law (that existed at the time) are you going to charge them
- Where is the evidence

If you start examining the whole mortgage industry over the period in question, I would fully expect the majority of cases that would be filed would be fraud perpetrated by the borrowers and their agents against the banks!

Somewhere along the lines I can a cross a comment which is very true, it went something like this: "In a bubble borrowers did what borrowers do, banker did what bankers do, but politicians did not to what they should have done" and that was to stop the bubble developing.  But then again, it they had, we'd have voted them out.... right?


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## Leper (3 Jan 2013)

Jim, like I said on at least two previous occasions, I am not a lawyer. I would love to be able to point to a law that the Bankers broke. That said, I dont believe their irresponsibility was within the law (just my opinion) and I think our Fraud Squad should be looking for laws in which they can prosecute. Look around you and you will find evidence everywhere, houses worth 60% less now than six years ago, people unable to pay mortgages, many unemployed because of the recession, the amount of people who took their own lives, Life Savings gone, etc. How much more evidence do you want?

I reiterate just saying that Bankers do what Bankers do is a cop-out (no offence). And if the Bankers worked within the law, what does it say about our country?


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## Conan (4 Jan 2013)

Leper,
I guess we will have to agree to disagree.
Under a democracy, if people did not break the law, you generally cannot jail them. You are right that over the past few years people have seen property values fall, some are unable to repay mortgages, more are unemployed etc..... But what has that got to do with law breaking. People made mistakes, some borrowed too much, some paid too much for property, some lenders lent too much..... But where is the illegality in that. 
None of this is evidence of illegality, stupidity perhaps, but not illegality. So why just jail Bankers ( it might make you feel better, but that's hardly a justification). One of the problems in today's Irish society is the need to feel that we must blame somebody for our predicament (rather than looking in the mirror). It could not possibly be our fault, either Bankers, politicians, economists, bond holders are to blame.....but surely not me. After all I never voted FF, I only borrowed to buy a house (not even a house in Cape Verde islands), I was never told about the oncoming world economic collapse etc etc etc. I will surely feel ( and be ) better off if some Bankers go to jail. Ah yes... That will solve everything...


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## Leper (5 Jan 2013)

Fair enough Conan, we can agree to disagree.
Regards
Lep


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## Bronte (7 Jan 2013)

Leper said:


> I would love to be able to point to a law that the Bankers broke. That said, I dont believe their irresponsibility was within the law


 
How is being irresponsible illegal?  We know bankers were careless and reckless in their lending.  We know they were greedy too.  But none of those are illegal.  

So far all we can see that might be illegal is playing around with balance sheets and a possible share price support.   And the day a banker is jailed will be a Champagne day for me.  But I'm not holding my breath on that.


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