'Iceland lied to us' says Dutch ex-central banker

2nd February 2010, Comments 1 comment

The Icelandic central bank lied to its Dutch counterpart about the soundness of Landsbanki, mother company of failed bank Icesave, an ex-managing board member of the Dutch institution alleged Monday.

The Hague--"The Icelandic colleagues, I can't say it any other way, lied to us," Arnold Schilder, responsible for bank supervision at the time of the Icesave collapse, told a parliamentary inquest into the global credit crisis.

"We asked several times how things were going. Every time they told us ... there was nothing wrong."

Schilder is the current chairman of the International Auditing and Assurance Standards Board.

Icesave was an online British arm of Iceland's second biggest bank, Landsbanki, which was nationalised by Icelandic authorities in October 2008 at the height of the financial crisis.

Icesave's collapse prompted the Dutch and British governments to advance 3.8 billion euros (5.4 billion dollars) to reimburse 320,000 citizens who lost their savings.

Iceland's parliament narrowly approved the terms of a payout to London and The Hague on December 31.

But Iceland's president refused to sign the bill, citing public opposition to the deal and leaving it to a national referendum, due on March 6.

Opinion polls suggest that voters will reject the payout.

Last week, senior Dutch, Icelandic and British government officials discussed the disputed compensation deal in The Hague, with Dutch finance minister Wouter Bos saying that Iceland must repay the money "no matter how."

AFP/ Expatica

1 Comment To This Article

  • HTD posted:

    on 2nd February 2010, 10:55:26 - Reply

    Caveat emptor! Any investors who thought that they could realistically receive the kind of returns IceSave was taunting probably were also invested in Bernie Madeoff's pyramid schemes as well.
    And just like Madeoff was handled, the Iceland bankers, who put this mess together, should be 'put on ice' to cool their heels until their children qualify for social security. And just like Madeoff's greedy investors, you have already paid for your greediness. Why should the average Icelander have to pay for what their bankers and its irrational customers contracted to? Caveat emptor.